Dispelling the Myths About a No Fax Cash Advance

In recent years a number of misconceptions and myths about financial products including no fax cash advance loans, payday loans, and other short-term lending solutions have arisen, driven in part by an aggressive campaign against these services by traditional lending institutions. Many consumers have been taken in by misleading claims and outright misinformation promoted and disseminated by major financial lobbyists in order to discourage borrowers from taking advantage of payday loan opportunities. These lobbyists wish to maintain the financial monopoly of the major banking institutions and ensure that competing loan products do not threaten this monopoly.

In order to counter this misinformation, here are some facts about the payday loan industry.

Payday loan rates are reasonable

Federal regulations require that the fees associated with all loans be expressed in terms of annual percentage rate (APR); however, the APR figure is often misleading when considering short-term loans including payday loans, paycheck advance services, and no fax cash advance loans. These loans are not meant to be long-term debt solutions; in fact, compared to the cost of many other banking and credit card charges, the APR on a payday loan is exceptionally reasonable. For example, bank charges and merchant fees assessed for one returned $100 check average around $54; this represents an APR of 1,409%, more than four times the APR for the typical payday loan. Banks do not advertise these charges in terms of their APR because they are not required to do so, but they constitute a far greater financial drain on consumers than the average payday loan fees. In most cases, the fees associated with just one returned check represent a higher annual interest rate than payday loans ever reach.

Payday loan providers offer straightforward terms

Because payday loan applications and forms are simplified and streamlined, the terms of the loan are typically far easier to understand than the loan agreements designed by traditional lending institutions. Payday lenders abide by the provisions of the Truth in Lending Act; this ensures that borrowers understand the true cost of their loans and that they are provided with full and accurate information about payment options and finance charges. Especially for online no fax cash advance and payday loans, the contract terms are made clear to consumers both before the application and after approval, ensuring that borrowers are aware of all charges, costs, and obligations incurred by acceptance of the loan agreement.

Payday loans provide a valuable service

Companies that offer online or in-person payday loan services provide their customers with fast, convenient service that the traditional banking institutions cannot match. The application process for a loan from a bank or for a credit card can last for a month or even longer; payday loans are typically approved within a few hours, and provide access to funds quickly. Store loans usually provide the cash directly, and require the shortest wait; payday loan providers can wire the money to your bank account with same day service. Most no fax cash advance providers provide overnight service, allowing consumers to obtain cash conveniently the next day. Traditional lenders cannot match the payday loan industry’s speed of service and approval percentages. Because payday lenders provide loans even for those with bad credit, they cater to a largely under-served segment of society that often experiences difficulty in finding viable financial solutions in emergencies. These loans present a higher risk than most banks are willing to assume, and as a result come with a somewhat higher fee schedule; however, when financial emergencies arise, payday loans present a reasonable alternative for consumers who may find few other options available.

No fax cash advance loans and other payday loan products are a valuable resource for many consumers who may find themselves short of cash before payday. While these loans are not intended as long-term solutions for financial problems, they present a useful short-term option when unexpected emergencies arise.