Payday Loan

"I just need enough cash to tide me over until payday." Sounds familiar to you? I'm betting it does. We constantly find ads to this effect on radio, television, Internet, and even in mail. The type of loan being referred to, of course, is payday loans. And they come at a very high price, too, by way.

Payday loans have become a way for people to get fast cash. Check cashers, finance companies and others are making small, short-term, high-rate payday loans that go by a variety of names. Sometimes, they're called cash advance loans, check advance loans, post-dated check loans or deferred deposit check loans.

But how do payday loans work? Well, usually, a borrower writes a personal check payable to lender for amount he or she wishes to borrow plus a fee. Afterwards, company or lending institution would then give borrower amount of money in check minus fee. The fees charged for payday loans are usually a percentage of face value of check. Sometimes, fee may be charged per amount borrowed. For instance, for every $100 loan you borrow, you get charged a fee of $50. If loan is extended, a process referred to as "roll-over", you are obliged to pay additional fees that could incur. So for example, you make an extension of two weeks for your $100 loan. That means, you pay a total of $150 in fees, provided that one week equals to a $50 fee.

The Paperwork

As your home appreciates in value, you gain equity. You can look at this equity, as a portion of value of your home, which becomes an asset that is not burdened by debt. Therefore, this is a critical financial vehicle that cannot be ignored.

Let me say it another way. For most of us, your home Equity is likely to be, primary, unencumbered assets of your own, personal estate.

Here are several things to consider, when managing this critical financial leverage:

1.Retirement 2.Debt Consolidation 3.Home Improvements 4.Equity Lines of Credit 5.Other

1.Retirement:

Personally, I hate debt. I absolutely, positively, detest debt. I do everything in my power to completely eliminate it from my life. Therefore, this first method is my own, personal favorite.

a)Leave it alone. Ignore it. Pretend it’s not there. Forget about it. Live life as if it did not exist.

b)The equity in your home can become an absolutely essential cog in wheel of your retirement. But in order for it to work its magic, you need to allow it to build and grow, and avoid all temptation to tap into it.

c)If you can do this, then at end of tunnel, there is a nice nest egg waiting for you.

2.Debt Consolidation:

Of course, above principals of using equity for retirement may not be entirely wise, if you are burdened with additional debt.

a)If your debt is large and encumbering enough, then you may want to consider refinancing and incorporating that debt into a new, first deed of trust. Not only is this more organized and simplified, but you can stretch loan out over 30 years, thus allowing more affordability.

b)If you wish to pay off additional debt sooner, or if debt is small enough, then you might want to consider a second mortgage on home.

c)Either way, interest paid on either new first loan, or second loan, will be a write off, and thus, you will gain an added benefit by restructuring.

d)In addition, interest rate on a second (or first) is far lower, then what you’d expect to pay on an unsecured loan, such as your credit card.

3.Home Improvements:

There comes a time in everyone’s life, when you just want to make some changes around homestead. If you are in market for a new pool, a decked out backyard landscaping job, a new roof, or new appliances, et al., then a second loan or refinance is generally way to go.