Cash advance loans have witnessed quite the attention over the past few years. More and more people are seemingly interested in getting cash advance loans as opposed to bank loans because of the convenient terms and speed of cash transfers.
However, despite the success or incredible growth that the cash advance industry has gone through, there are still a lot of myths that go around discoursing potential borrowers. The following sections clarify some of these and explain why they are called myths in the first place.
Myth #1: Cash Advance Lenders Prey on People deep In Debts Already
Critics claim that the increase in the number of cash advance providers is because more and more people are getting into debts and businesses wanted to take advantage of that. The growth of the cash advance industry relies on the extent of consumer demand and this goes or applies for every payday loan lender. Simply, cash advance businesses or institutions found it to capitalize on services that banks are no longer offering or are still not offering.
Cash advance providers exist because some people saw that there’s a genuine need for institutions providing immediate cash help to the community. Since it is possible to provide such services, institutions have invested on such. Not just for the sake of profit but also to address the growing need.
It is actually a win-win situation for both the lenders and borrowers because not many banks offer such kind of specialized services. The idea that the cash advance industry is predatory is quite distorted and does not provide an accurate picture of the business and its markets.
Myth #2: Cash Advance Loans Cost More than Paying Overdraft Fees
Some have pointed out that paying overdraft fees is a more desirable option than getting cash advance loans because they costs less. However, this is not the case, overdraft along with late fees are actually more expensive than cash advance loans. These fees are imposed on bank accounts or credit cards without direct notification to the account holder. This in fact leaves a lot of people surprised because their account statements or credit card bills cost more than they are willing to pay or have deducted fees already.
Getting cash advance loans allows you to work with a one-time flat fee. You are informed about the rates that will be applied to your loan prior to reaching any agreement. The borrower is actually informed about all the terms and conditions and any fee that will be imposed. There are lending regulations prohibiting lenders to impose hidden additional fees. For instance, for every $100 worth of borrowed money, people may around $15 for cash advance loans while credit or bank account overdraft fees can reach range from $30 to $50.
Myth #3: Cash Advance Loans Industry Do no Bear the Consumer’s in Mind Best Interest
There are many critics claiming that opposing or competing industries of cash advance loans provide better terms and other services than payday loans. Simply put, there’s the idea that the cash advance loans is only deceptive in terms of being consumer friendly. More than just a myth, this aspect in fact only derogatory claims seeking to put down the industry when in fact no extremely negative reports have been filed and considerable reviews have been piling up for this industry. Another aspect of this myth is that it is supposedly exploitative in nature targeting unsuspecting people for better profits.
Take note that cash advance loans are only made available to individuals who need or actually seek for them. Further, there are minimum requirements imposed thus the cash advance loans are also just made accessible to people who can actually pay them and not those who will get stuck paying piling interest rates or rollover loans (though rollovers are barely possible). The payment terms and the condition of the whole transaction rely equally on the borrower and the lender.
Myth #4: Cash Advance Lenders Make use of Aggressive Collection Procedures
There are also claims indicating that cash advance lenders implement collection procedures that are aggressive in nature and almost forces consumers to pay for their loans in an unpleasant or forceful way. This is only an exaggerated myth for it is not possible to force people in an unpleasant way to pay off their debts. Prior to their borrowing, people are already aware of their responsibility to pay off their loans. Failure to do leads to unpleasant circumstances such as penalties but none of these without the borrower’s knowledge.
It is also important to note that lenders follow specific lending regulations per state. Their procedures and terms of business all go in accordance to such regulations thus it is not possible to initiate harmful collection procedures without the state knowing and without the lender getting penalized or punished for it. As said, all terms are given or laid out plain and clear to the borrower thus no part of the procedure should be damaging or harmful to the person borrowing money.
There are also a number of people or critics saying that the society is better without cash advance loans. However, it is important to note that cash advance loans make it possible for people to settle their debts in an instant, pay for emergency medical bills, bridge the gap between their bills and their next payday. It is in fact more useful than damaging.
So what are you waiting for? Get your cash advance today!