Cash Advance Watch Out

Cash advance is a new concept spreading like quick fire in the US market today. The easy availability of cash has lent the scheme hot cake popularity in the United States today. Money flows in with a magic wand these days. Walk into any street where such schemes are operative and you come out with $100, $500 and sometimes even $1000 as payday loans. The other name for these programs are "Quick Cash", "Quick Loan", "Car Title Loans" and "Cash Advance". The concept is not very old but they are starting to sprout up all over the country and will soon rival Starbucks for sheer number of locations. They are the new trend in predatory lending practices but still manage to fly under the radar of regulation in most states. They don't charge interest; they charge a "fee". But it sounds like the ultimate in convenience.

Need some quick cash - stop by and in just five minutes you can be out of the door with $100, $500 even $1000. This hassle free availability of cash as and when required really has given it immense popularity. A cash advance or payday/paycheck loan is usually secured by a personal check. Some companies want your bank account or credit card information in addition to the check. You write a check to be cashed or agree to have an amount withdrawn from your bank account sometime in the future; usually 14 days (the standard payroll period). After completing the agreement/contract you are given an amount that is less than what you have agreed to pay. The difference is the "fee" for the loan service. And you have got your cash. Take a note of following before you decide for anything.

1. Early repayment fees:
This is a fee when you pay off your loan early. Pay off your loan early and they sock you with another fee.

2. Late repayment fees:
This is a fee you need to pay when you are repaying it late. You may have to pay the entire fee again if you miss the payment date.

3. Membership fees:
Some companies offer membership and they charge for that along with charging you as their customer.

4. Giving lenders access to directly debit your bank account. Just hand them your wallet, it's quicker.

5. Fine print (as in all contracts):
This is important whatever you do in your life, read twice before signing once. Know what you are signing or don't sign it. Most of the times there are some hidden traps for you; go through each and every sentence on the papers. Don't hesitate to put queries and clear all your doubt before signing it.

6. Bounced check or debit fees:
Take care of your bank account before signing the document, make sure you have money in your bank account or you get to pay your bank a fee as well.

7. Collateral requirements such as a car title: This is very dangerous if not done properly, you miss your payment and you may be missing your car - permanently.