Under Truth in Lending Act, cost of payday loans, like other types of credit, must be disclosed to borrower. Other pieces of relevant information that you must receive in writing include finance charge or dollar amount and annual percentage rate or APR. The APR refers to cost of credit on a yearly basis.

Fast Cash, High Rates

A payday loan, which is a cash advance loan secured by a personal check, is a very expensive source of credit. But despite this, many people still opt for payday loans. To explain to you just how expensive payday loans can be, let's say that you need to borrow $100 and so you write a check for $115 which would pay your loan for up to 14 days. The check casher or payday lender agrees to hold check until your next payday. At that time, depending on particular plan, lender deposits check. You then redeem check by paying $115 in cash. If you can't make payment, you can also roll-over check by paying a fee to extend loan for another two weeks. In this example, lender charges you $15 as fee and at same time, loan costs you 391 percent APR. If you roll-over loan three times, finance charge would climb to $60 to borrow $100.

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b)It’s a write-off.

c)The money spent, goes towards improving home, and thus, adds to overall value of your estate.

4.Equity Lines of Credit:

It’s always good to plan for emergencies.

a)An Equity Line of Credit can provide you with security you need to ensure that you’ll always have liquid assets around, should you need them.

b)This is much more effective than having a large amount of money sitting in a low to no interest bearing savings account in your local bank. Open an equity line of credit, and go invest that money so that it is working for you.

c)It’s also harmless, free, and usually tax-deductible should need arise to use it.

d)Just keep in mind importance of discipline. Don’t use it, unless it’s absolutely necessary.

5.Other:

A word of caution: I’m not advocating that you jump in to uncharted waters, or freely spend hard earned equity that you’ve so diligently been building.

a)But it is your equity. You can save it, consolidate with it, spend with it, and use it to invest in other properties, other businesses, other ventures.

b)So your equity is like your own personal bank. It requires no applications, no processing procedures, and no approvals by board of directors. It requires none of that, because it is yours. You own it.

c)But just keep in mind, that you have equity because of diligence, intelligence, wisdom, and discipline. You’ve grown it, and now that you have it, another word of caution: Don’t waste it frivolously.

Be good to your equity, and it will be good to you.

We’ve enjoyed providing this information to you, and we wish you best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.

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