04 Jun Payday Loans
Payday loans seem to be all the new rage. What is a payday loan you ask. Well in simple terms it is an advance on your salary. It is a short term, unsecured loan. The term is normally less than 30 days. That is until the next pay day. These loan companies usually use a slider bar, so the borrower can see how much it is going to cost them in interest to borrow X amount of money. This is usually shown in a Rand amount, not as a percentage. So you know exactly what you have to back back to the lender.
These amounts that are borrowed may seem small as they are over a short time and the capital sum is not usually for more than R8000. But the interest is actually quite high if calculated over a year. This is due to the fact that the money lent is unsecured. Lenders globally have approximately 24% of borrowers defaulting. So they see these loans as fairly high risk and therefore charge a high interest rate.
It is for this reason that payday loans should only be used for emergencies and not to buy the latest most fashionable pair of shoes. If your car breaks down and you need your car for work, then it needs to be repaired. What happens if you don’t have the R5000 for repairs. Friends and family don’t have the funds to help bail you out. Or they simply refuse to lend you the money. We have all been in that position. This is when payday loans come to the rescue. They can help you out in a cash flow bind.
If you need to check out 3 of the local payday loan specialists then click here . But remember, only if you really need the money.