Costs Behind A No Credit Check Payday Loan

Everything in this world comes at a cost. However, many do not mind shelling out extra for a service if it ensures ease and convenience. So, while no credit check payday loan is more expensive than conventional loans, it is the comfort that is offered by these loans that should be kept in mind while comparing the two.

Costs And Charges

1 Interest Rates

The cost of a two week cash advance no credit check loan ranges from $15 to $30 for every $100 that is borrowed. This implies that if you borrow $100 for two weeks, you will have to pay $115 to $130 on your next payday for it.

However, there are many differences in the loan periods and interest charges among various lenders. A number of lenders offer these no fax no credit check cash advance for a period that may last anywhere from 1-4 weeks (depending upon the next payday). While some lenders charge a flat fee regardless of the no credit check cash advance period, quite a few may impose varying weekly charges.

Payday loan lenders do not charge an interest rate. They charge a service fee that usually depends upon your pay. Sources like Federal State Commission (FTC) and Consumer Federation of America (CFA) state that the normal annual percentage rate (APR) is between 350% – 650% and can go as high as 780%.

2 Membership Fees

Other than the service fee, many lenders require you to pay an initial membership fee to become eligible to take their services. In case of the established no credit check payday loan lenders, this membership entitles you to various discounts and cheap deals on payday loans. However, if little known lenders require you to become members, it is recommended that you stay away.

3 Early Repayment Fees/Late repayment Fees

Early repayment fees will generally be charged if you decide to repay your loan before the due date. Late repayment fee is a penalty that you need to pay for breaching the payday loan contract. This should generally be avoided. Sometimes the lender may even file a lawsuit against you. Moreover, if you account falls short of the borrowed amount, the bank will charge a hefty ‘Bounced Check’ fees. A bank charges anywhere from $20 to $30 for a bounced check- add this to the borrowed amount, interest charges and the late penalty fee. The total amount will be too huge to pay off.

4 Loan Extension Fees

Payday loan lenders generally allow for a loan extension, but at an extra cost.

source:http://www.americanchronicle.com/articles/viewArticle.asp?articleID=47920