Payday Loan Lending

Payday loan lending has been around for years making it possible for consumers to have access to fast cash without worrying about credit worthiness or approval waiting times. Financial emergencies often times require money in a hurry and most "traditional" lenders, such as banks and credit unions, don't offer the timeliness that is equally matched to payday lenders. With these types of short-term loans, consumers are expected to pay back what they borrow within a small-time frame; usually with their next paycheck. Lenders use their own collectors to deal with defaulted payments but identity thieves have found their own way to try and collect on these loans, and unfortunately many consumers are falling for this!

Payday loan lenders, also know as providers of "small dollar loans", withdraw loan payments from the borrower's bank account on or around the same day that the borrower's paycheck goes in their bank account. In the event that the money is not available for repayment, the lender will most likely be willing to make payment arrangement's with the borrow in an effort to see them repay their loan successfully. If that doesn't work, then a collector will get involved. It will most likely be someone from the payday loan lending company, or perhaps a third-party collector. Lenders will never get the police involved nor will the seek out the FBI to regain their lost funds.

A recent fraudulent act has identity thieves posing as FBI agents trying to scare consumers into paying off payday loan debt that they may not even owe. Using ID spoofing technology, consumers answer their phones seeing "Federal Investigations" on their caller ID. The impersonator on the other end of the line then claims they are an FBI agent who has been monitoring the call recipient's online activity as a payday loan borrower. While the unsuspecting victim on the telephone may or may not have a payday loan account, the thief posing as an FBI agent will threaten legal action, and even jail, if not paid by wire-transfer or pre-paid debit card. These thieves may even have access to a person's address, place of work, or social security number.

Consumers need to know that regardless of any loans held, these so-called FBI agents are phonies and have no power to collect any type of money whatsoever. In the event that you do receive a phone from someone claiming they are an FBI agent and that they are looking for a payday loan payoff, here are a few things to keep in mind:

*Any money exchanged via wire transfer or prepaid debt card cannot be reversed or tracked. It's like sending cash,which is why the person calling will request that you send funds that way. Once you pay them, you will have no chance of getting your money back.

*If you are in fact solicited by one of these impersonators, hang up and don't call them back. While you may feel you want to "set them straight" it's not worth getting into a confrontation and risking giving them information that they can use against you later.

*Be sure to report the incident to your local police department; especially if you feel threatened.

*While you may have have caller ID and it is correct most of the time in identifying your callers, don't believe it if it says "FBI". Caller ID spoofing has made it possible for perpetrators to pretend they are anything from representatives from your utility company to immigration authorities.

*If you do decide to speak with the caller, ask then to provide an official "validation" of the debt. The law requires that they do this and include the name of the creditor, the amount of the debt, and a statement of your rights under the Fair Debt Collection Practices Act. If the "collector" is not willing to provide you with the information you are requesting, then hang up. This is a sure sign that they are not legitimate.

Emergency Payday Loan

What Are Payday Loans?

Payday loans, sometimes referred to as payday advances, are short-term, unsecured loans, usually for small amounts. The only collateral that is generally required to apply for these specific loans is some form of employment records, like pay stubs, although the term payday loans has become a shorthand for any type of small, short-term loan even if it's not technically backed by a direct reliance on a borrower's next paycheck. Payday advances, like any loan vehicle, are regulated heavily. These regulations vary widely from state to state in the United States, and from country to country internationally.

Payday Loans Are A Booming Business

Payday lenders have had seen booming success worldwide, and credit that success to offering a service that was not formerly available. They point out that emergency cash loans offer an attractive alternative to people who are not able or willing to use less expensive conventional routes to borrow money. Some companies that offer emergency cash advances in the UK have described their approach as a handy financial service for young, Web-savvy borrowers, accustomed to the ease and convenience of instantaneous online communication. These applicants often feel left out of the conventional banking system. Today's modern consumer, raised entirely with social media, can even apply for these micro-loans using their smartphones, with money transferred to successful applicant's bank accounts within minutes.

 Compare Payday Loans With Other Loan Types

Many types of short-term loans can seem expensive when the fees associated with the loan are factored as yearly APR. For that reason, payday lenders prefer to compare their loan products to bank overdraft fees and other charges that traditional lenders use to recoup funds. Many payday lenders don't even characterize their business as banks, simply as another form of Internet technology, used to connect willing borrowers with willing lenders.

Payday Loans Are Available 24/7

As traditional outlets for loans become harder to find and are requiring larger and larger amounts of paperwork for even small loans, payday advances have stepped in to fill the vacuum. They're available day and night, seven days a week, and in many cases the process is so fully automated that loans are granted without the borrower ever having to speak to another person. After applicants have established a track record of successfully paying off cash advance loans, some lenders only require applicants to text the amount of the desired loan, and the term of the loan desired, and the money is instantly made available.

 So Why Would I Pay the Added Interest?

Sometimes it's an unexpected emergency, or it may be that an opportunity has come up you couldn't possibly pass up. Is it tickets to the playoff? Has a friend obtained access to ringside seats at the "fight of the century"? Or maybe you have committed an unforgivable sin and forgotten your significant others birthday...

Whatever the reason, you're short on cash. If you haven't got credit cards and maybe your friends and family are not in a position to help out. What do you do?

It's increasingly common for those in immediate financial need to approach a short-term lending company for a "payday loan". These loans are often unsecured, meaning the borrower has no collateral to provide. This makes the loans a high-risk cash advance for the lending company. If the borrower bails, there's nothing of value to collect. They compensate for the increased risk by charging very high-interest rates.

The applicant usually must provide proof of employment, and government issued identification. The idea is that when the applicant's next pay check is issued, the funds will be used to pay off the loan. In some cases, the loans may be made for the borrower to purchase a car or other big-ticket item. In these cases, there is somewhat less risk involved for the lender. The item may be re-possessed should the applicant fail to repay the loan as promised.

  

So What is the Bottom Line

Companies around the world offer payday loan services including Canada, the United States, Australia and Great Britain. The rules and regulations regarding how much interest may be charged, and limits on the amounts of the loans vary depending on the country, state, province or county where the payday loan company is located.

The industry is growing; possibly the fastest in the UK, where there are fewer regulations on how payday loan companies may operate. UK firms have expanded into Canada and Australia. In a few states in the United States, super high-interest loans (such as those provided by payday loan advance firms) are illegal.

On the spot check-cashing is another service that is frequently offered by payday advance companies. Perhaps the customer does not have a bank account or wants immediate access to the cash. A flat charge or percentage of the check amount will be charged as a fee. Short term loan companies often open early and close late to take advantage of those who need immediate access to cash.

Steps to Improving Your Credit Score

It is undeniable - we are facing some hard economic times. In these times it is imperative that you keep your credit score as high as possible if you have any goals of buying a house or a car or anything else that will require lending. There are 6 key steps that you should strive to take in order to ensure the best credit score possible.

1. Reduce your open credit card utilization as much as possible

This may be the most important factor of all in boosting your score. If your credit cards are maxed out, you will be viewed as a high risk by many lenders. Strive to keep your utilization below 20% - if you're already there, great! If not, put every extra cent you have towards reducing your utilization.

2. Make sure to pay all of your bills on time

This one is a no-brainer. If you establish a good history of on time payments, lenders will view you as having less risk and more credit worthy. Late payments can retain on your credit report for 7-10 years, so make sure that you keep up with the due dates!

3. Don't close your old accounts!

Another important factor to your credit score is the average age of your accounts. By keeping an old card open that you don't use, you add history to your report. If you were to go and close this account, your average history would be reduced thus decreasing your score.

4. Have a good variety and number of open accounts

This tip does not carry as much weight as some of the others mentioned above, but is also important. By carrying a mix of revolving (credit card) and installment (student loan, car loan) loans and paying them on time, you show that you are able to maintain responsibility which will increase your credit score.

5. Keep your hard credit inquiries to a minimum

This number resets every 2 years. You should strive to keep the number of requests for hard inquiries to under 2 in this time period if possible. Every time you apply for a credit card or a loan, this number is increased, which will slightly hurt your score.

6. Don't rack up any derogatory marks

Items such as bankruptcies, accounts going to collection, liens and civil judgments can devastate your credit score. Make sure that you live within your means and pay everything on time. These marks could take up to 15 years to be removed from your report so prevent them as much as possible!

Follow these 6 steps and start on your way to financial freedom!

Brad @ Whatisagoodcreditscore.biz.

Tricks Credit Card Companies Use

Many credit card companies offer cards that reward you with frequent flier miles or money towards the purchase of a new car. But you should study the terms carefully because if you don't qualify, they have been known to send a completely different card with different terms. Before you pay more in interest, cancel the account immediately. You should also avoid zero-percent offers because there's always a big catch especially if you miss a payment or when the introductory period ends and the rate goes sky-high.

They have fees to charge for nearly every situation. Some charge a late fee if your monthly payment isn't received by a specified time on a certain day. Check your statement for due dates and times. Watch for over-the-limit fees and transfer fees if you're transferring a balance from another credit card. If you're maxed out and the new credit card has a lower limit than you think, you'll be hit with an over-the-limit fee and possibly a higher interest rate as a consequence for going over. Also be sure to ask how long the new credit card's introductory rate will last. Usually the rates are only good for six months. Taking cash out of your credit card is a bad idea because the rate for cash advances is much higher than it is for purchases and there is no grace period, you start paying interest right away. Credit card companies also stick it to you when you vacation abroad. Visa and MasterCard both charge a 1 percent currency exchange fee and some major banks charge a 2 percent fee on credit card and debit card purchases made outside the United States.

These companies are also notorious for changing their payment P.O. Box. When you send your payment to the old address it meanders around their headquarters before finally making its way to the payments department who then charges a late fee. Check the mailing address each month, pay early and consider paying online to avoid this situation.

If your payment was late last month, the company may have forgiven the fee but you may see an increased rate on next month's statement because you were late on a payment. Credit card companies frequently check your credit report for late payments on auto loans to justify rate increases. Remember fixed rates really aren't fixed. By law, credit card companies must give you 15 days notice before they raise your rate. They don't need a reason and if you call them and ask them to lower it, they don't have to do it. If your credit card company resorts to these tactics, the best thing you can do is get a new card and cancel the old one.

Avoid buying insurance. If your card is stolen, you are only liable for up to $50, making theft insurance a needless expense. Disability insurance through your credit card company will only make your debt worse, if it ever kicks in.

There's a reason these companies set the minimum payment at 2% of your total debt. At that rate you'll be paying it down the rest of your life. Pay as much as you can with the goal of paying off the entire balance as quickly as possible. Another trick is shrinking the grace period between the statement date and the payment due date so that by the time you get your bill, you're already paying interest on the balance you carry.

Finally, you need patience, persistence and a good sense of humor to deal with customer service agents who will transfer you, put you on hold and even hang up on you until you are blue in the face.

Negotiating with credit card companies is exhausting but can save you money in the long run. This savings will help your pocketbook, help your credit score, and make it easier to get a military loan.

Fix Your Credit Report Yourself!

You may think you know your credit history, but surprises lurk. Before applying for a loan, a line of credit or even for a job, you should take a look at your credit reports to make sure there are no errors.

If you have already been turned down for credit the company would have to let you know in writing which agency had negative information on you. With letter in hand, you could call the agency and ask for a free copy of your credit report.

There are three credit reporting agencies and they store separate scores sometimes with a wide margin between them. Each report could show different errors. Mistakes happen fairly often so check the report carefully starting with your personal information like your name, your date of birth and your Social Security number.

Then you check the information on each account. You may find that a loan you had paid off long ago is still listed and still active. The account may be in the name of a family member or someone with the same name as yours.

Check that there is only one account for each creditor. You will want to check that there is no one else using your credit. If you are a victim of entity theft, the sooner you discover this and start to clear this record, the better off you will be. Identity theft can cost you about 180 hours to deal with the matter and around $1,000 in costs so that alone is a good enough reason to check your credit history on a regular basis.

Checking your own credit report will not have a negative impact on your credit score. To get your free credit report, go to http://www.annualcreditreport.com. Or you can phone toll free 877-322-8228. As the name implies, you are entitled to one free credit report per year.

If you find something, find proof of the error and send it via certified mail to the credit agency that has the error. The address of the bureau is on the credit report.

They have 30 days to ask the company that placed the negative information to submit their rebuttal. If the company doesn't respond within 30 days, the credit bureau has to remove the negative information.

If you find enough of these errors, you will see a good improvement in your credit scores in about 30 days after that. You can decide if you need to work with a credit repair agency to negotiate with your lenders.

You can check out my web site to get the 'civilian's' point of view and research results in navigating the traps of credit repair and the impact of bad credit on your life that you may not have been aware of.
Please go to http://www.fixmycredithistory.com/ to get the latest information.