How much Interest!

It's important to pay particular attention to the rate of interest on Payday loans. The rate on cash advances may be 500% per year or more. Borrowing $200 for 2 weeks at 500% will cost you $38.36. Compare this to borrowing $200 for 2 weeks at 36% ($2.76) or 12% ($.92).

If this loan is refinanced 4 times, the cost difference increases dramatically! In fact, it will cost you nearly $200 to borrow $200 for ten weeks:

YOU SHOULD AVOID TAKING OUT more than one cash advance payday loans!

If you already have no faxing payday loans outstanding, you should avoid taking out another such loan. When you have more than one cash advance payday loans outstanding, you may find it very difficult to pay the required finance charge payments, much less paying all or a portion of the amount financed when the loan comes due. If you need a larger, longer-term lend, you should seek other, more traditional, lending sources.

How do they work

Payday loans work like this:

You fill out an application and provide the lender with items such as paycheck stubs and a photo ID.

You sign a lend agreement, write a postdated check to the lender, and receive your cash.

Your check is held until your loan payment is due - usually two weeks. The lender then deposits your check - unless you have replaced the check or have already repaid the loan.

The lend agreement that you are required to sign is a legal document that obligates you to repay the loan. It also sets forth a lot of important information. Be sure to take note of the following:

Amount Financed: The amount of credit provided to you or on your behalf. (This is typically the amount of cash you will receive.)

The Finance Charge: The dollar amount the credit will cost you, or the amount of interest you pay for receiving the credit.

Annual Percentage Rate (APR): The cost of your credit as a yearly rate. Because these loans are small, short-term transactions, the APR is typically quite high. In Wisconsin, there are no laws that limit the interest rate that a lender can charge.

Total of Payments: The amount you will have paid after you have made all payments as scheduled. (This is the amount that you will write your checks out for.)

What the resposibilities are

The lend agreement you sign legally obligates you to repay the lend. Make sure to read the contract before signing it and retain your copy for your records.

If you have not renewed the loan or paid it in full, make sure you have sufficient funds in your checking account on the due date of the loan so your check clears when the lender deposits it.

If you cannot or do not repay the loan, the lender can seek a money judgment against you for the face amount of the check and court costs; and, if they were disclosed in the contract, any late charges, interest after maturity, and NSF fees. Once a money judgment is obtained, a lender may attempt to garnish your wages.

Many lenders also list past due accounts with the credit bureau. This may affect your ability to get credit in the future.

Other things to consider

If you pay the lend in full prior to its due date you are entitled to a partial refund of the finance charge.

If you are married and your married person does not sign the loan agreement, the lender is required to give your spouse a written notice that you obtained the loan.

questions you may have

The Department of Financial Institutions (DFI) is a state agency that licenses and regulates firms that make consumer loans in Wisconsin where the interest rate is over 18% per annum. This includes the no faxing payday loans companies. Wisconsin residents may contact DFI Licensed Financial Services at 608-261-9555.

DFI also licenses and regulates adjustment service companies, commonly referred to as debt counselors or consumer credit counselors. These organizations help debtors set up and keep on a budget. A list of the adjustment service organizations licensed by DFI. Wisconsin residents may also contact DFI Licensed Financial Services at 608-261-9555 for the name of the adjustment service firms nearest you.