There is a way to get a low rate payday loan however you must have an average to good credit to get one.
Recession has forced cash crunch among families. People are loosing jobs and unable to meet even the basic needs like repaying their debt and buy certain luxuries. Most of them find it extremely hard to make both ends meet and resort to payday loans as a means of making some quick cash.
First and foremost let’s be very clear: Payday loans are loans that should be taken for emergency situations only and should never ever be misused. If you misuse them, they will misuse you for a long time. So beware. Take payday loan only if you are not getting a loan from any other source.
If you do some research on people applying for payday loans, you will find that consumers are not bothered about the rates on the loans that they are applying. Consumers usually don’t shop aggressively for lower rates. What they want is a loan and they want it fast – whatever the rates. This isn’t good, but this is what it is.
Well this may be ok for people with bad credit. They might not get the loan, or will get it higher rate anyway due to high risk to the lenders. However people with good credit should always search for lower rate lenders because they are most likely to get a loan with a low rate.
One of the best ways to get a payday loan with a lower interest rate is to apply with a direct payday loan lender.
WHY?
Payday loan is a very lucrative business. Lenders sometimes charge interest rate as high as 550% per annum. If a lender throws in $100,000 in payday loan business how much can he make by the end of the year? You do the math.
However the story is not so rosy. There are a lot of bad debts in this business. A lot of people default and do not payback the money. However still, payday loan is a lucrative business.
This is a guess but a strong one – almost 30% of people who take a payday loan default. This is an average. A lucky lender might see a default rate of only 20%. Even though lenders lose money, they make much more to make up for the loss.
Payday loan is a lucrative business and has attracted a lot of lenders. In fact now days even banks have started offering payday loans. Therefore a lot of lenders have jumped in this business. Fact is these people are not actually real lenders, but loan brokers. They market payday loans, get a lead and sell it to direct lenders and charge a commission per sale. The commission depends from lender to lender and the way they are able to bargain.
Now it’s a no-brainer to conclude that if lenders have to pay a commission they will extract it from the consumer that is you. And how they do it? It’s by increasing the interest rates. Therefore it is the poor consumer who ends up paying the extra fee charged due to these brokers.
So how do you get a payday loan with a low interest rate?
By now you must have got the point. If you have a average to good credit, it’s almost always better to get a loan from direct payday lenders.
We have partnered with direct lenders to offer our visitors payday loan with low rates. Here is our low rate payday loan application. You can try us out and we bet our rates will be lower than what you may have been offered elsewhere.