There are several key things that you have to look for in a payday loan contract prior to signing. You don’t want to agree to a loan offer before reading it in full, no matter how generous it seems on the surface. When you take a close look at these things, you will increase your chances of getting an amazing overall deal on your loan. One of the biggest mistakes you could possible make is to breeze through the loan offer before you have gone through even the tiniest details and fine print.

  1. Interest Rate

The interest rate will definitely be one of the biggest things to look for in your loan contract. Make sure that the rate mentioned in the contract is what you agreed to with the lender from the start. If you think that you could do better, you might want to take some time to shop around. Payday loan rates can be somewhat high, but you should be able to get a reasonable deal with enough research. You probably shouldn’t agree to the first offer you are given unless the rate is truly low.

  • Interest After Default

You should also find out what the interest rate will be on your loan if it goes into default. This will essentially be the rate you pay if you fail to pay back the loan by the due date. The default rate is typically much higher than the regular interest rate. You will need to keep this in mind when looking at your contract.

  • Early Repayment

The loan contract should also say something about prepayment, which is when you pay back the loan before the due date. Most of these private lenders allow prepayment and don’t charge any penalties, but this isn’t always the case. You have to check to see what the contract says before proceeding. You don’t want to borrow from a lender that charges any prepayment fees or penalties, regardless of how low they are. You should be able to pay back your loan early if you are able to without having to worry about any additional fees.

  • Hidden Fees

Make sure that there are no hidden fees whatsoever in your loan contract. This isn’t something that most payday loan lenders do, but you still want to be aware of it. The last thing you want is to deal with paying a lot of extra fees that you weren’t anticipating. Legitimate lenders don’t charge hidden fees. If you see this in the contract you are sent, you should start looking for a different lender immediately. It just isn’t worth all of the hassle and extra expense.

  • Payment Amount

If you are borrowing a large sum of money, you might be paying your loan back in instalments. If this is the case, you will need to check the contract to see how much each payment will be. You’ll most likely be required to submit one payment each week or month. These details are very important when you are trying to determine whether or not you can actually afford the loan. This amount should include the APR and any other fees for a total amount.

  • Late Fees

Pretty much all lenders charge additional fees if a borrower is late paying back their loan. This is unavoidable, but you still need to know how much they are going to charge. You shouldn’t choose a lender that will charge you an exorbitant late fee, as it should be a somewhat reasonable amount. If the fee is very high, you can always try to negotiate it down. Most of these lenders are pretty flexible, but some are willing to bend farther than others.

  • Due Date

The date that the loan is due to be paid back in full will be included in the final contract/agreement document. You need to know when you have to pay it all back by so that you aren’t late. Make sure to ask the lender what their policy is like on giving extensions. If you are in a position where you need more time to pay back your loan, you should be able to get it. Most lenders are fair enough to do this, but it never hurts to double check.

Before you go ahead and sign that payday loan contract, you absolutely need to consider all of these things. It is important because these terms and details will have a direct impact on your ability to pay back the money on time. The more thorough you are in looking over all of these details, the better off you are going to be. You shouldn’t treat getting a payday loan as a casual thing, as it is a serious financial matter.

When it comes to repaying the payday loan you take out, there are a few crucial things you’ll have to know. While the process might seem pretty straightforward, some people have issues due to a basic lack of knowledge. We will provide you with all of the information you need to pay back your loan on time and in full. This will help you to avoid a number of very unpleasant consequences, which you should also understand. You should not get this type of loan without know how to go about repaying it first.

What Happens if I don’t Repay My Payday Loan?

If you simply do not pay back the money you have borrowed from the lender, the full balance of your account will be sent to a collections agency. You will be contacted on a regular basis to pay the money you owe. This usually takes the form of frequent phone calls, emails, and regular letters in the mail. Your credit will also take a fairly major hit. You can expect a substantial decrease in your overall credit score. This will make it far more difficult to obtain any type of financing or loans in the future.

Repaying Your Loan Early

An overwhelming majority of private lenders will allow their customers to pay back the money they owe early. You will need to check your loan contract to see what exactly it says about early repayment. You should definitely try to do this if at all possible, as it can save you a lot of money on interest. If there is a prepayment penalty, you need to find out what it is. If this is the case, paying your loan back early might not be worth it. It’s a good idea to look for a lender that doesn’t charge anything for early repayment.

Late Payments

If you have an instalment payday loan and you miss a payment, you will be charged a late fee. This fee could be fairly nominal or quite expensive, depending on the lender. If it is your first missed payment, they might be willing to waive the fee. You should at least talk to your lender about doing this, as the worst they can do is say no. Before you sign your loan contract, make sure that you understand what the late fees are like so you know what to expect. Late or missed payments will negatively affect your credit, so you need to keep that in mind as well.

Getting an Extension

Some lenders are willing to give borrowers an extension if they aren’t able to pay back the loan on time. If you expect to be late paying back your loan, you should get in touch with your lender right away to find out about this. You might not be able to get more time from your lender, but it’s an option worth exploring. Most lenders are willing to do this, simply because they want to get paid the money they are owed. You won’t be given an indefinite amount of time to pay back your loan, but an extra few days or week could be of great help.

Automatic Repayment

It is now fairly common for payday loan lenders to automatically take the full amount of the loan from the borrower’s checking or savings account on the due date. This is sometimes optional, but you have to ask the lender to find out for sure. Automatic repayment is typically a good thing, as it makes things a bit easier for you. You won’t have to worry about remembering to pay back the money you owe. There is nothing worse than incurring steep late fees because you forgot that your loan was due that day.

Alternative Ways to Repay Your Loan

If you are having serious problems paying back your payday loan, you might want to consider using a credit card. While you still have to pay off your credit card balance, it can help you avoid all sorts of high additional fees. Take the time to consider this option carefully so you don’t end up making a bad decision. If you have a credit card with a 0% introductory APR, this could be a great option.

You absolutely have to repay your payday loan on time, because otherwise you are going to be left in a very bad financial situation that is difficult to get out of. The best thing you can do is to spend some time finding out what your repayment options are. Make sure that you look for a flexible lender that can work with you if you end up having problems with repaying your loan. The more reasonable your lender is, the easier it will be to reach a good solution for both parties.