Low Interest Payday Loans
The low interest payday loan is sort of like finding Sasquatch. Low interest payday loans come in a few varieties, but they all generally end up expensive for you. Here are a few of the marketing ploys you should look out for.
The High Fee Low Interest Rate Payday Loans
These payday loans are the most common because you feel like you aren’t being charged an interest rate that is completely eye gouging. Essentially you pay a high fee for the privilege of loaning your money for a very short period of time (like two weeks.) When you actually do the math you end up paying 300% plus interest. You may feel it’s worth it for only two weeks. If you really only do it for two weeks it may be, but most people don’t. Plus if you loan your money to a thousand different people for only two weeks it is still like you’re getting 300% returns on your money.
The First Time Payday Loans with Low Interest
The next loan marketing concept is to get new people with a low interest first time offer. They know that the majority of people will stay using the payday loan broker they already know. They want to get people who have never done payday loans before. Once they get in the habit of doing payday loans it can be hard to break it. The next time they come back because they are still $500 short they will be paying full rates for it. Sometimes when you come back they also blend in a high fee with your higher interest knowing you are now stuck in the cycle. If this is you, you need to break your mold and just go find another new provider offering a new first time offer. This can be a great tactic for the active payday loan user.
The Repeat Payday Loans with Low Interest Rates
The last marketing ploy is to offer lower rates for frequent users. This is tricky because the point of a payday loan is never to be routine. It is meant to be an emergency. If you are looking for a routine loan you need to go through the effort of getting approved for a traditional loan or a credit card. Just because you’re comfortable with the quick loan it doesn’t mean it should be used for everything. Just because I like to use a hammer it doesn’t mean I should saw with it. Loans are no different; they are designed for specific use. Don’t depend on payday loans for long time use. The interest rate only looks low because you are used to high interest rate payments from your previous experience.
Summary
Payday brokers are always looking for new clients. One way to increase their business is to entice new customers with low interest payday loans. There is nothing wrong with using their services. Just be sure that the offer remains good. If it does not, pack up your business and move to another company. Getting a loan doesn’t mean you have to be desperate and miss out on better deals.