21 July 2008
What Is A Payday Loan APR
Posted by James Hacking under: Business .
Today, the majority of people in the United States know what APR is, while understanding this is something attached to mortgage loans. However, a payday loan APR also exists, which is not understand as well.
Interesting, the maximum APR allowed to be attached to a payday loan is regulated in many states. For the borrower, this is good but even then, often a short-term loan comes with an APR that is high.
What is an APR?
Although many people do know what an APR is, some do not. In fact, many people have no understanding of a payday loan APR.
APR stands for Annual Percentage Rate, which is the annual interest rate that you will be paying on the loan itself. When you have a large loan, like a home or car loan, the APR is normally very low because it takes longer to pay back the loan.
However, with Payday Loan APR, it works a little differently.
Payday Loan APR 101
Payday loan APR is a much, much bigger number than a home loan APR is - it has the highest interest rates on any sort of loan, but that’s because it is a very short term loan. Usually between 7 and 14 days, these loans don’t span much at all - so you usually end up only paying between $10-$40 in interest.
You can normally find APR numbers between 250% - 390%, which is rather large, until you consider that you’re borrowing just a small amount, and you’re going to pay it back quickly.
Of course, there are some states that keep tight tabs on APR rates charged by these companies. Therefore, the APR allowed to charge with other factors, such as the length of the loan and whether extensions are allowed, would also be regulated. Just remember that laws are different for every state - some strict and some not so rigid.
When Searching for a Payday Loan…
When you go looking for a payday loan APR, there are a few things that you should keep in mind. That’s the APR. The lower it is, the less you will need to pay when you are getting ready to pay your loan.
However, sometimes people overlook the fees. What happens is that they see the APR and believe it is reasonable but once fees are added, they realize they are paying outrageous fees for a loan. Therefore, it is always best to look for loan companies that offer not only a low APR, but also low fees.
Things To Remember
Remember to borrow wisely, and don’t go with a company that has too high of a payday loan APR - you’ll feel the crunch later!
Payday Loans Online with Instant Approval has great Payday Loan APR, with low fees, and helpful customer service… when I need a loan, this is who I go to.