While payday loans aren’t for everybody, they can be the perfect remedy for those who need to use them and understand how they work. When used wisely, a payday loan may be just what you need to get you back on the right path financially. There are several myths concerning payday loans that are both misleading and inaccurate. Some of the popular myths concerning payday loans include:
Myth -1: Focus on Low-Income Households
Fact: Online payday loans are available to anyone who needs them. No specific income bracket gets targeted ever. Lenders are only interested in providing short-term support to get you through a difficult time, no matter what your financial situation.
Myth -2: Difficult to Pay Back
Fact: Payday loans are for short-term needs. Loan reps are always available to help you determine what type of loan is best for you so that you won’t have any problems when it comes time to pay the loan back.
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Myth -3: Excessive Fees
Fact: Any fees attached to online payday loans get disclosed upfront. Lenders make sure the entire process is as transparent as possible so that you know what the inclusive charges are. While there are a few costs, the amounts are not excessive, and you are made aware of each one before you sign the contract.
Myth -4: Higher Than Normal Interest Rates
Fact: The interest rates for short-term loans are slightly higher than a traditional loan from a bank. That’s due to the short-term nature of the loan and the added convenience of an almost immediate payout. When you factor in the quickness of the loan to be approved and the overall amount you’re allowed to borrow, the cost evens itself out.
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Myth -5: More Loans, Higher Commission for Lenders
Fact: Contrary to what many people think, lenders, don’t receive a commission for closing a short-term loan. In most cases, if a payday loan is not right for you, they will be more than happy to help you find another solution.
There is much more to payday loans than what the myths make them out to be.