If you know the tricks of a trade, you can bargain for anything on the earth, even loans. With a large number of players in the loan market, scraping out a cheap deal is not tough. You can easily get a cheap payday loan; all that is required is market awareness and conscientious approach.
Personal payday loans offer quick cash over a period of about 2 weeks. Made available instantly, cash is advanced without exhaustive credit checks and documentation. While the convenience offered is attractive, it does not come for free. A payday cash advance is 5-10% more expensive than credit cards. The annual percentage rate (APR) of cash advance is exorbitant, ranging anywhere between 400%-800%. Consider this against a 20-25% annual return on a high interest stock.
So let us chart out a step wise approach to get the best bargain.
Step 1: Conduct A Market Survey And Compare Cost
Before you decide upon an option, compare 3-6 lenders and the deals offered by them. A significant variance exists in the fees charged by these companies. Read between the lines. Compare the charges as well as the borrowed amount duration. Be especially careful in checking the fee, if the company claims it offers no teletrack loan. A no teletrack payday loan implies no credit checks will be undertaken. But do not be happy about it.
Teletrack is a system used by the industry to check an applicant's history. So a lender may not run your teletrack report prior to loan approval, but they do cover the higher risk. A company offering no teletrack charge a much higher loan fee. Likewise, their APR is much higher than the lenders who undertake teletrack checks.
To sum up, at the end of this exercise, you should know the exact charges for a 2 week personal payday loan.
Step 2: Fix The Amount To Be Borrowed
Now that you have zeroed in a cheap cash advance, do not get greedy. Borrow only the required sum. No point paying a fee for the cash advance you never used. Just in case you end up needing more funds than the payday loan obtained, apply for a new cash advance with another company.
Step 3: Borrow For A Short Period
Borrow for the shortest period possible. Confirm beforehand if lender allows for loan prepayment.