Cash advance loans have become a very popular means of solving one’s financial problems. They are very efficient since the time required for their issuance is very short and since the payback period usually takes no more than a month or a few months. However, these conveniences have their price as well and this price comes in the form of high interest rates and high fees as well. This is why this article will try and explain in detail what the expenses of a cash advance loan are.
Since interest rates, as well as fees, are not regulated by law in any country, lending companies and banks have the freedom to set their rules and their own criteria. Thus, the fees and rates differ among banks and companies and this difference can sometimes be quite big, probably depending on the area the company or bank is settled in. However, rates usually range from 20% to 30%, with the average of 25% being the most usual. Thus, for instance, if you decide to borrow a sum of $500 at a lending company that offers the interest rate of 25%, you will eventually have to pay back the total of $625. However, if you borrow the same amount from a company that offers the rate of 30%, you will be obliged to return the total of $650.
As far as the fees are concerned, they also vary among different banks and companies and they are also quite high. In fact the fees can range from $25 to $40 taken per every $100 that you borrow. Thus, if you again take a loan of $500, the fee can range from $125 to $200. This is quite high and this is the very reason why you should carefully choose the company or the bank that you wish to borrow from. You can do this via the Internet by visiting different websites that contain a lot of information on practically all the existing lending companies and banks. Another convenience is that you can also apply for a loan online by simply filling out an online application form and submitting it.
You should also bear in mind that in case you fail to pay back the loan within the given period, you will have to pay additional fees and this can turn into a vicious circle that never ends. Thus, be very careful when deciding about the cash advance loan.
To sum up, the expenses of cash advance loan can be really high. However, if a cash advance is the right solution for you, then try to find a company that offers the lowest interest rates and fees. In this way, you can even get away with only cheep charges if we can call them cheep. You should also be careful and decide objectively whether you can really pay back the whole sum within the given period. If not, than you should better opt for another solution for you will be faced with additional charges.
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