Payday Loans

Las Vegas Payday Loan – 5 Things To Keep In Mind

If you are considering borrowing a Las Vegas payday loan, there are several things that you need to take into your careful consideration. To start with, you must be well aware of the payday lending laws applicable in the state of Nevada. Though these types of lending programs are legal in Las Vegas, they do not make the best financial decision. These are small amount of loans that are issued for a very short period of time; the repayment period is usually not longer than two or three weeks. The eligibility criteria are very simple ones and even the application process is very easy. Lenders do not check the credit score of the applicants to determine their eligibility for payday loan. There is no complex paperwork, no faxing of documents. The only problem is that these loans usually turn out to be very costly because of the extremely high rate of interest and hefty amount of additional fees that payday lenders charge. Besides that, the provisions of automatic rollover or renewal of loan if the borrower fails to make the repayment on the set due date is also a major factor that makes payday lending in Las Vegas a risky affair. Following is a brief rundown on the five most important things that you must keep in mind.

The Legal Restriction Applies Only To The Maximum Amount Of Loan That You Can Borrow

When it comes to Las Vegas payday loan, the first thing that is very important for you to keep in mind is that the state laws have not yet taken any serious step to restrict the rate of interest that is charged on these loans. The only legal restriction is on the maximum amount of loan that a lender can issue to a borrower. As per the Nevada laws, you may not borrow more than 25% of your gross monthly income. However, the laws do not say anything specific about how many outstanding payday loans you can have at a time. It means you are free to borrow as many loans as you want. Likewise, even lenders are free to charge as high an interest rate as they want; as long as you agree to pay back at the proposed interest rate, the loans will be treated as legal and you will be liable to make the repayment as per the agreement.

Review The APR Thoroughly

APR stands for Annual percentage rate. Lenders often design their Las Vegas payday loan programs in such a way that it looks like an easy solution to your temporary financial problem. But, it is very important for you to review the cost of the loan thoroughly. Read the loan contract thoroughly before you sign it. A Nevada judge has recently reported that there are payday lenders in Las Vegas that are charging interest on these short-term cash advances at 7300% per annum. In fact, it is not just about the interest rate; lenders also charge various types of additional fees, which the borrowers usually do not realize.

Look At The Due Date And Decide If You Will Be Able To Pay Back Within Such A Short Time Period

The due date is the next major factor to consider regarding Las Vegas payday loan programs. Because of the high cost involved with these loans, you may have to pay back $175 for every $100 you borrow for a 14-day time period. Therefore, you are also advised to review the terms regarding repayment thoroughly. The idea is to make sure whether you will practically be able to ensure timely repayment. Will you have sufficient amount of fund available in your bank account on the set due date to repay the loan? If not, you can be pushed into a serious debt trap.

Understand The Provisions Of Rollovers And Renewals

Failure to make the repayment on a Las Vegas payday loan usually results in rollovers or renewals. As per these provisions, the lenders extend the due date for one month. It sounds like a great favor by the lender, as they provide you thirty more days to pay back the loan. The catch here is that you are charged additional interest (at the same high rate) and hefty amount of penalty charges for the extended period of time. Nevada laws allow two such rollovers. If you fall into this trap, your outstanding loan balance will keep on growing faster than your imagination. If you are late by one month, you may be liable to pay double or triple (or sometimes even more) of the actual principal amount of money that you initially borrow.

Know Who You Are Borrowing From

Last, but not the least, you must also be well aware of who you are borrowing a Las Vegas payday loan from. It is very important for you to keep in mind that there are several payday loan stores that are running their businesses illegally in Las Vegas. Even not all Internet-based lenders are duly licensed to issue such loans in the state of Nevada. Therefore, if you must borrow a payday cash advance, make sure that the lender is question is duly licensed and that they abide by the payday loan laws applicable in your state. An easy way to do a thorough background check is by reviewing their past records that is maintained by organizations like the Better Business Bureau (BBB).

Overall, if you keep in mind the above five things before signing up for a Las Vegas payday loan program, you will be able to make an informed decision.

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