Payday loans may be helpful when you are having temporary money problems or are facing a financial emergency and need cash on a short-term basis. You should attempt to pay your loan in full when it matures. If you are unable to do that, you should make every effort to pay at least part of the amount borrowed before you renew the transaction.

How much Interest!

It's important to pay particular attention to the interest rate on cash advance payday loans. The rate on Payday loans may be 500% per year or more. Borrowing $200 for 2 weeks at 500% will cost you $38.36. Compare this to borrowing $200 for 2 weeks at 36% ($2.76) or 12% ($.92).

If this loan is refinanced 4 times, the cost difference increases dramatically! In fact, it will cost you nearly $200 to borrow $200 for ten weeks:

YOU SHOULD AVOID TAKING OUT more than one cash advance payday loans!

If you already have cash advance payday loans outstanding, you should avoid taking out another such loan. When you have more than one cash advance payday loans outstanding, you may find it very difficult to pay the required finance charge payments, much less paying all or a portion of the amount financed when the loan comes due. If you need a larger, longer-term lend, you should seek other, more traditional, lending sources.

How A Payday Loan Works

cash advances work like this:

You fill out an application and provide the lender with items such as paycheck stubs and a photo ID.

You sign a lend agreement, write a postdated check to the lender, and receive your cash.

Your check is held until your loan payment is due - usually two weeks. The lender then deposits your check - unless you have replaced the check or have already repaid the loan.

The lend agreement that you are required to sign is a legal document that obligates you to repay the lend. It also sets forth a lot of important information. Be sure to take note of the following:

Amount Financed: The amount of credit provided to you or on your behalf. (This is typically the amount of cash you will receive.)

The Finance Charge: The dollar amount the credit will cost you, or the amount of interest you pay for receiving the credit.

Annual Percentage Rate (APR): The cost of your credit as a yearly rate. Because these lends are small, short-term transactions, the APR is typically quite high. In Wisconsin, there are no laws that limit the interest rate that a lender can charge.

Total of Payments: The amount you will have paid after you have made all payments as scheduled. (This is the amount that you will write your checks out for.)

YOUR RESPONSIBILITIES

The lend agreement you sign legally obligates you to repay the loan. Make sure to read the contract before signing it and retain your copy for your records.

If you have not renewed the loan or paid it in full, make sure you have sufficient funds in your checking account on the due date of the lend so your check clears when the lender deposits it.

If you cannot or do not repay the loan, the lender can seek a money judgment against you for the face amount of the check and court costs; and, if they were disclosed in the contract, any late charges, interest after maturity, and NSF fees. Once a money judgment is obtained, a lender may attempt to garnish your wages.

Many lenders also list unpaid accounts with the credit bureau. This may affect your ability to get credit in the future.

Other things to consider

If you pay the lend in full prior to its due date you are entitled to a partial refund of the lending charge.

If you are married and your better half does not sign the loan agreement, the lender is required to give your spouse a written notice that you obtained the loan.

IF YOU HAVE QUESTIONS

The Department of Financial Institutions (DFI) is a state agency that licenses and regulates companies that make consumer lends in Wisconsin where the interest rate is over 18% per annum. This includes the cash advance payday loans company. Wisconsin residents may contact DFI Licensed Financial Services at 608-261-9555.

DFI also licenses and regulates adjustment service firms, commonly referred to as debt counselors or consumer credit counselors. These firms help debtors set up and keep on a budget. A list of the adjustment service organizations licensed by DFI. Wisconsin residents may also contact DFI Licensed Financial Services at 608-261-9555 for the name of the adjustment service firms nearest you.