Instant Cash Loans Fact And Fiction Part II
In the last article, we spoke about the unfair labels that were being attached to instant cash loans and were showing the fact versus the fiction. This second article will provide more of the same and show that online cash loans are an excellent way to solve a short-term financial crisis.
Fiction #4
Instant cash loan companies make tens of billions of dollars off the backs of those who have the lowest income. They look to lend money to the poorest elements of society in the hope that these clients will fail to repay the cash and be left with a huge rollover bill.
Fact #4
It’s in the best interests of the online cash loan company to have all the money repaid on time. This way, they have a chance of gaining repeat customer.
The longer a cash loan is left unpaid, the more likely it is that the customer will default which is the exact opposite of what the company wants. Get a loan off a bank and they want some sort of collateral such as a car or even your house. With an instant cash loan company, you can borrow $200 and only pay $30 interest which is perfectly ok if you’re in desperate need.
Fiction #5
Instant cash loan companies deliberately hide certain fees on their terms and conditions. This is seen as being a deceptive practice and is designed to take yet more money from customers.
Fact #5
On the contrary, there are strict laws in all 37 states where short-term cash loans are legal which prevents hidden charges. All instant cash loan companies are obliged to show their full array of terms and conditions. It’s also a myth that these companies look to earn money from rollover payments. The reality is, the majority of cash loan borrower uses the loan once, repay it on time and the company never sees these people again.
Fiction #6
The instant cash loan industry is poorly regulated and steps need to be taken to clamp down on the illegal lending practices performed by these companies. In California, it’s hoped that the Justice Department will intervene and heavily regulate the industry. It’s also claimed that lenders in other states are disguising cash loans so that they look like personal ads.
Fact #6
There are 37 states where payday loans are legal. They were made legal in California in July 1996 where they are recognized as small secure loans which are perfect for emergencies. Any extra fees paid by customers are worth it in their eyes because they receive the money within 24 hours and don’t have to undergo a credit check. It is believed by many that the short-term cash loan industry is over-regulated if anything. If the government were to stop being so strict, a free market may emerge and reach out to those in real need. APR rates would be competitive and the consumer would benefit in the long-term.
In summation, it’s clear that instant cash loans are far from the evil they are depicted as. Like all loans, they carry risks to both borrower and lender but they do provide an emergency service that is unavailable anywhere else.
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