Banking
Did you know that you don’t
need a bank account to cash a
government cheque? You can
bring it into any bank (even if
you don’t have an account
there) and they will cash it for
free. You will need
identification with your photo
and signature
Cheque Cashing Outlets
These places will charge
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you a percentage of your
cheque plus a service fee to cash your cheque! For example, on a $1,000
cheque they could charge you a 3% fee ($30) plus a $3 service fee – that’s $33 to
cash your cheque!
Payday Loans
A payday loan is a short-term loan of two to four weeks against your next
pay cheque. Payday loans are offered by private lenders and cheque cashing
outlets.
You can usually borrow up to 50% of your next pay-cheque amount. To get the
loan, they will ask you for additional info (for example, identification, pay stubs
etc.).
Pay day loans are a very expensive way to borrow money. There are many high
service fees and interest charges. These get even higher if you do not pay the
loan back on time, you may not be able to avoid paying the interest – there could
even be fees for paying the loan back early! The average fee for a two-week,
$300 loan is over $60. If you work that out to a yearly interest rate, it is 520%!
If you do take a pay day loan, make sure you review the loan agreement and
understand its terms before you sign it. Always keep a copy for yourself.
If you are thinking about a Payday Loan, here is a link to 10 questions to ask
yourself before taking out the loan:
http://www.fcac-acfc.gc.ca/Eng/resources/publications/creditLoans/Pages/
Consider-Vousenvi.aspx
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