Things You Need to Know About PAYDAY LOANS
Payday Loans often termed Salary Loans or Cash advance loans are short-term loans, relatively small amounts provided with the assurance to be paid back as soon as the borrower gets his salary or payday. Payday loans are generally for the period of one or two weeks, as they are borrowed for the instant need of money and are to be paid back after the next wages arrive. Borrowers need to provide a postdated cheque of the amount to be paid to the lenders. If on the very particular day the cash amount is not received by the borrower, the lenders are eligible to deposit the cheque in their respective accounts, which in case of bounces can result in a hike in the paid amount because of the cheque bounce penalties together with the effect of notice period being over. Borrowers can also use electronic mediums to receive and pay the amount.
Who are eligible to get payday loans?
Borrowers need to have a bank account and a steady source of income with their identification ids to get a payday loan, which ensures that the person is trustworthy enough to pay the loan amount back, as he is employed and earning.
Payday lenders
The payday loans are provided either by some payday loan stores or the stores providing other financial services. To prevent the unreasonable and excessively high rates of interest on these loans by lenders, some jurisdictions limit the APR i.e. annual percentage rate that any lender can charge.
Payday compensation and refund
In some cases, the payday loan proves to be a load for life, as it can reach an extent where it becomes impossible for you to repay the whole amount you borrowed as the amount becomes unaffordable. This case generally arises when the interest rates are getting higher and higher and you are unable to pay the final amount every time. The amount generally becomes unaffordable when the only way to pay it, is to take on another loan. Sometimes the company is responsible for the situation as it provides a loan to a person who already is trapped in other loans, or is not in a suitable financial state, in such a case, the person can ask for a refund or compensation, after proving that the company didn’t treat him fairly. Treating unfair means suggesting wrong ideas, plans, or schemes, that took the borrower to a stage where he is all surrounded by financial crises.
The borrower can prove the company was responsible for the amount getting unaffordable status for him, as it lend the loan, even after seeing the bounced cheque records, and the financial state of the borrower, the amount is now that large that it consumes more than half of his income, making it impossible for him to repay. The borrower hence can ask the compensation or a refund of the amount.
The question that arises now is what amount should be claimed for compensation, this depends on the current situation. Was it totally clear to the lender that the amount is becoming unaffordable to the customer, and if it was so then why was the lender still lending money? The amount after which the loans lend were becoming too high to get paid back by the consumer should be refunded or compensated.
Though the customer isn’t likely to get the whole amount refunded, he can ask as much as he can, and let the justice decide further. The customer first can simply ask for removing the unaffordable loans from his credit account, and a refund of all the interests he paid.
