Pay Day Loans
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.
A pay day loan is a short-term loan of two to four weeks against your next
pay cheque. Pay day loans are offered by private lenders and cheque cashing
outlets.
If you are thinking about a pay
day loan, here is a link to 10
FreeImages.com Content License-Kate Gelman
questions to ask yourself
before taking out the loan:
http://www.fcac-acfc.gc.ca/Eng/resources/publications/creditLoans/Pages/
Consider-Vousenvi.aspx
Cheque Cashing Outlets
These places will charge 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!
Did you know …?
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.
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