What is a payday loan? Further editorial at http://hitomi-gyousei.com
Currently more than 20% of Brazil’s general household income is used only to pay off loan installments, and this includes interest, which can usually be quite heavy. And when it comes to payroll loans, the installments you have on your loan will be deducted directly from your benefit or your salary, whatever the case may be.
This means that a good part of your income will be compromised before the money reaches your account. A loan of this type, if not properly planned, can end up making your life very difficult, and greatly increase the expenses you have, paying interest. In more extreme cases, such a poorly planned loan can lead to cases of over-indebtedness.
However complicated things may be, credit can be as much an enemy as an ally to your budget. It is important for you to understand when it is worth making a paycheck loan and how much credit this can cause you to wind up more than you should.
Payroll loan is certainly the most incredibly cheap line of credit on the market. Because of this she is a real hand on the wheel sometimes. Those who have a formal contract, or are retired, pensioners and civil servants, both federal and municipal (or state), can have access to this type of loan easily and quickly.
However, you have to be very cautious when it comes to the contract. In order to be able to use this type of loan in your favor you must be well aware of its operation and also the situations in which it can become a good ally or an enemy, if that is the case.
To be able to get out of debt or achieve that dream, sometimes you need to have extra help, and a payday loan may be just what you need!
Let’s start with the main advantages that a payroll loan has over other types of market:
With its lower rates than other lines of credit that the market has to offer, this type of loan is really useful in times of emergency such as some type of medical problem, more expensive repairs in your home, or car, and Here it goes.
This is because the bank already has the guarantee that it will receive the installments every month, which means that there is little bureaucracy when hiring and also to release your money directly into the account. The ideal is that the loan does not exceed 20% of what you earn every month, unless you are wanting to finance something, such as a property, since in this case the margin may be slightly higher.
Financial agencies have the habit of offering longer repayment terms in this type of loan. Some banks even make offers of up to 120 months for you to repay your loan.
Now let’s take a look at the disadvantages of this type of loan when you do not plan the debt well:
If by chance you are working in a private company, there is always the risk, however small, of being unemployed. If this happens, either you will take out your loan at one time or you will have to change your mode, which is usually much more expensive.
Moreover, it is very common that the payroll loan agreement already has some clause providing for discounts in the amount you receive from your termination. That’s why it pays to read your loan agreement before you ask for it.
You have to keep in mind that unforeseen circumstances can always happen and if any of them catch you unawares while you are still paying off your loan, since the installment is automatically deducted from your salary, you will have to pack up some other option to be able to cope with your problem. That is why it is so important to think very carefully before hiring the service.
The discount will be made before the money even enters your account, that is, you can not delay or even suspend this debt. You may still find it difficult to renegotiate the loan if necessary. Now you know what the pros are and what the cons are. How about seeing the situations in which a payroll loan is worth the penalty? Give only one check:
When it is not worth hiring a payroll loan:
Now that you already know everything about payroll loan it is easy to know if this type of loan is for you, whether it is worth making the request, and at what times it becomes necessary. Remember that when applying for a loan it is indispensable to thoroughly read the agreement and be aware of all terms and clauses.