Making It Through The Semester: What College Students Need To Know About Payday Loans
Going to college can be financially straining, especially if you are working your way through school without assistance from your parents or other family members. During your time at school you may find you are in need of extra cash to fix your car, buy supplies for a project, or make rent by the due date. If you have a steady job and just need money immediately for an emergency, you might consider taking a payday loan. However, there are some things you need to know before you sign on the dotted line and walk away with your cash.
Loan Generation Fee
Payday loans are widely known to come with a high fee. It usually ranges from $10 to $30 for every $100 you borrow. If finances are tight this month, then they will be even tighter the month after you pay back your payday loan.
When you take the loan you should not only think about how you will pay it back, but you should already be considering how you will compensate for the origination fee in your next month's budget. Perhaps you will have to give up your morning coffee, or going out to the club with your friends on the weekend. Whatever sacrifice you need to make, stick with it.
Paying Back the Loan
College students generally have very busy lives, and if you are going to school while working then your life is among the one of the busier ones. This means that you may not have the time to stop in at your lender's shop and pay your loan back on time.
Most payday lenders protect themselves from late payments by asking you to leave a check or authorize a bank transfer that they will cash if you do not return on the specified day. Some physical lenders, and most online lenders, will allow you to authorize a transfer when you take the loan and then not require you to return to their store to close the loan. These lenders may be a better choice for you as a busy student.
Renewing the Loan
Every time you renew a payday loan, you will be required to pay a rollover fee. Some lenders charge less for a rollover and others charge more than the origination fee. The important thing to remember is that if you call your lender, explaining that you cannot pay back your loan, and they offer you an extension, it is not a free extension.
You should only take a payday loan if you can absolutely pay it back on time. If you can't, then you may have to think of other ways to come up with cash fast, such as working online or donating plasma.
Using Online Lenders
Online lenders can be a great option because you can get your money deposited into your bank account immediately, at any time of day. Also, they are convenient if your campus is outside of town and you do not have easy access to a storefront lender.
However, if you borrow online it is important that you are aware that the lender may not be regulated to work in your state. This means that you can get worse rates on your loan than some storefront lenders give. On the other hand, shopping around online can give you a better rate as well, so it is important that you know the going rate and make some comparisons.
Being on your own during college can be stressful, and the first time you have financial problems you may find yourself unable to decide upon a course of action. If you cannot get money from friends and family, and you have a legitimate emergency, you may consider payday loans, like those at Money 4 You, as a viable option until your next paycheck.