Growing trend of short-term loans in the country
Are you wondering about the payday loans trend in the U.S? The declined in the number of payday lenders storefronts have stop the growing trend of short-term loans in the country. The stringent regulation of the payday lending industry have forced many lenders to closed shop and moved their business online. So, when you need to borrow money immediately, borrowing online is now the trend.
Payday loans are very expensive to obtain because of the high interest rate charge by lenders online and offline. Many financial advisor and even payday lenders advised responsible borrowing because of the high rate associated with these types of loans in order to avoid the common payday loans pitfalls that affected a lot of people since these loans become popular.
By the way, payday loans are costly given that the average interest is about 15% of the principal amount borrowed, with repayment terms of 2 weeks. This translates to 390% APR or annual percentage rate. Additionally, payday loans in the United States America is allowed in 37 states, while 13 states prohibit or consider cash advance illegal way to get instant cash.
Take note, some states do not banned payday loans but only regulate them in the form of the usury laws or limits. The states that consider payday loans illegal are:
- Massachusetts (highly regulated)
- New Jersey
- New Hampshire
- New York
- North Carolina
- West Virginia
These states prohibit payday loans but it does not mean that residents from these parts of America cannot borrow money from payday lenders because they can from online lenders. Hence, when running out of cash or have unexpected expenses, just borrow online to save time and enjoy the benefit of payday loans.Share