During times of national economic struggles many of us are finding ourselves facing personal financial troubles. We have heard all of the advice and thus saved our money yet still unexpected situations seem to find their way into our lives.

We have scheduled payments that we prepare for yet along with these come difficulties we cannot predict. When your car breaks down in the middle of the month and you will not get your pay check for another two weeks you have to pay off the repairs but you are not sure the best way to go about doing so.

It is in these situations that payday loans are a great solution. These loans exist to satisfy a need that no others do; they get you out of short term financial crises.

You have to pay off your car repairs but you also have to pay rent the next week and you find yourself $100 short in the bank. This could mean many things.

You could take your car into the shop and write out a bad check and hope they do not deposit it until after you get your paycheck. The problem with this is that they will.

Companies take their checks in to the bank every day, and when yours goes in, and they discover you do not have enough money in your account to pay off what you wrote out, you will be charged a fee. Banks have overdraft fees that range from $25 to $50.

These fees are tacked on to every check that is faulty. On the $100 that you owe to the auto repair you will be paying an additional fee of $25 to $50 to your bank.

Because this is not the most appealing solution, you decide to look to other things. You really have to pay off your car because you just simply have to go in to work for the next two weeks.

This is where payday loans come in. With a $100 loan from a payday lender, you will be charged an average fee of a little over $1 a day.

On your two week $100 loan you will be eventually paying back $115. This means that you will be saving yourself anywhere from $10 - $35 just from taking out a payday loan.

It becomes apparent then that the payday loan was the most cost effective option. Despite the low fees of payday loans, they have high Annual Percentage Rates, or APRs.

This does not mean that their fees change or anything like that, it means that if the loan was to last all year then you would be paying a greater fee. Most banks and financial institutions have relatively low APRs.

This is because their loans last a lot longer so they are able to collect interest based on the duration of the loan. Payday loans do not have this opportunity and so have very high APRs in order to set a reasonable fee in the short term.

These APRs range anywhere from 250% to 350% and are commonly misunderstood because of the large numbers. Regardless of the high numbers, the fees translate into your small fee that you previously agreed to.

Taking out a payday loan is a very simple process. When you walk into a payday lender you can walk out with your money.

All you do is discuss with an employee all of the costs and fees upfront so there are no surprises at the end. You will then prove that you can pay off the loan by showing a paystub or other item that is evidence of a steady income.

When this is clear, you then write out a check in full for how much you are borrowing and how much you will owe upon termination of the loan. You make the check payable to the payday lender and date it for the day in the future when your loan expires.

This means they will take your check into the bank on the day your loan ends and you and the lender have thus completed the transaction. With this convenience, you must make sure you deposit your paycheck as soon as you get it.

The lender will be taking in your check and in order to save you money you should have the necessary funds in your bank. Along with this, taking out a loan means you are placing yourself in debt.

As with all loans you should make sure this is a necessary expense and that you will have enough money to pay it off when the time comes. Responsibility on your part means extra savings to ultimately lead you to financial freedom.

Jerry Daniels is a very trusted resource in the financial industry and has written many articles relating to consumer services and Personal Loans Online.

Contact Info:
Jerry Daniels
jerrydaniels08@gmail.com
http://www.PersonalLoansZone.com

[tags]payday loans, cash advance[/tags]