Payday Loans And Cash Advances Can Improve Your Personal Financial Health

quick tips in loan payments to help avoid damaging your credit

Payday loan services and payday advances provide an extremely convenient way for people to meet their financial obligations while still having money left over for bills or other expenses. App-based cash advances and payday loans allow you to borrow up to $1500 from your next paycheck to fulfill your financial obligations today. But due to their high annual percentage rates, payday cash loans can do more damage than good to your credit score. Likewise, short term payday loan rates, such as those found in payday loan stores, are typically determined by a patchwork of federal and state-level regulations, and payday loan APRs often reach up to three hundred percent in some cases.

First, avoid using a high-interest credit card to pay off your payday loan. If possible, use your personal credit card, which carries less interest than the store card, for this purpose. When applying for a payday loan, remember that it is better to have a small loan to fulfill your immediate financial needs than a large loan to pay off over time. Also, remember that payday loan lenders require a twenty-one day grace period following the due date to give you the option of reapplying for a loan with a higher APR. In this case, if you find that you’re twenty-one day grace period has lapsed, contact the lender immediately to renew your loan at a reduced fee.

Payday loans can be a great way to get yourself out of debt

but they don’t work well when you use them to replace other means of getting out of debt, such as making on-time payments to car or home equity loans. Many people mistakenly believe that they will receive a discount at a large chain bank because they have a good credit score and a long history of making their payments on time. While this is sometimes possible, most major banks do not offer discounts of this nature, especially if you have been missing payments in the past. The best option in these situations may be to apply for one of the many state-funded, federally funded, or privately sponsored consumer credit counseling services that provide free, no-obligation financial advice on matters ranging from budgeting and debt management to home ownership and refinancing.

Remember that it is better to have a small emergency than to carry a big debt load that is difficult to repay. Before you make any major purchases, consider how you will pay back the store card and the payday loan that are likely to come around the next payday. Will you be able to keep up with the payments? If you are unable to, you could be in danger of losing your credit card and having your wages garnished. If you must carry a balance on your credit card, make sure you set up a plan to make the extra payment when it is due.


Be sure to carefully read all of the terms and conditions of your particular payday loan or state-funded loan program before you submit an application for financing. Many lenders will penalize you for a number of different reasons, including late payments that cause an APR to be increased, as well as other fees for handling the loan. Also look at the lender’s affordability. How much money will they loan you, and how quickly will you receive your funds? When you find the answer to these questions, you can then decide if this type of borrowing is right for you.

Payday Loans and cash advances are a great way for some borrowers to manage short-term financial health emergencies. But while they can provide a helpful short-term solution, they should only be used as a last resort. Instead, borrowers should work to build up their personal credit rating, and work on budgeting and savings goals. For borrowers with bad credit, payday lenders often charge very high fees and interest rates. But when borrowers make their payments on time and within the terms of the agreement, they can help improve their overall personal financial health.

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