Why Payday Loans Are Still Hidden
Markets are flooding with options for those who have crunches in finances
, but the reason why only some options are so highly spoken about. There are options that are reviewed and recommended and those that are reviewed and criticized. The factors that are considered before making judgments on financial options in the market are quite a few. Payday loans still lurk in the dark because of the inability of reviewers to consider the biggest advantages of payday loans to be a valid factor while reviewing options.
Interest Rates: When a financial loan is considered, the first thing that people want to talk about is the interest rate. The calculation behind interest rates, are indeed misleading. The final rate is calculated for the entire year, hence shorter termed loans are higher in interest than longer duration loans. The reason why payday loans are given at higher rates is because of the fact that they are emergency loans that can be got in a short span of time. In the case of bank loans, the reason why they appear more reliable is because they are relatively less interest and higher durations.
Loan Amounts: The amount that can be borrowed using a loan option is also very important. The reason why people turn to a loan is generally because of immediate needs. The needs vary from small emergency needs or huge necessity needs. Banks cater to the people who need money for big expenses, while payday loans cater to the crowds that need money for immediate expenses that vary in size. It can either be a 100 loan, for a car repair or a 800 loan, for a down payment on a bigger purchase.
Installment Plans: There are only a few loan options that come with repayment schemes that make paying easier for the customer. Most payday loans do not have such options but there are some responsible payday lenders, who understand the customers stand point better than the others. Paying in small manageable amounts can only be an advantage because it makes it easier for the customer to budget.
Risks: Bank loans come with a huge list of verifications that need to be done before a loan is approved to a customer. This is the reason why it takes time to process a loan application form at a bank. Payday lenders have their own means to verify their applicants, but the difference is that this happens almost instantly. This can sometimes prove to a huge risk that the payday loans lender has to bear. This is one of the most important factors that reviewers need to consider before recommending or criticizing financial options in the market.
The reason why payday loans have such high rates of criticism is because none of the reviewers consider factors like, the speed of dispatching the loan, minimum paper work involved in the loan application process and hassle free transitions from stages of searching for loan options to financially stable positions. Payday loans need some better reviews for the advantages they have.
by: Steven Francis
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