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Deciding Whether A Payday Loan Is Right For You
Payday loans are often touted as a quick fix for a bad financial situation, letting you bridge the gap between running out of money and your next wage or salary coming in. The basic idea is that you can borrow a small amount of a few hundred dollars for a short period of a week or two, and repay the debt next time you get paid.
This sort of service can indeed be very useful if you’ve run out of cash for living expenses, or if you’re faced with an unexpected bill or expense that you simply can’t cover when you need to, but are payday loans always the good choice they’re presented as?
First, we’ll take a look at the undeniable advantages of these loans, before looking at the disadvantages, and possible alternatives you may be able to use if you decide a payday loan isn’t right for you.
The lending criteria for payday loans are very generous indeed, and almost anyone who’s employed and has a suitable bank account will likely be approved. This means that even people with terrible credit ratings should be able to get a payday loan, despite being rejected for nearly any other form of finance.
They are also easy to arrange, and you can often get the money in your account in a matter of days. Some lenders can even arrange an overnight transfer of the loan straight into your account the very next day, which is obviously very useful when you need cash in a hurry.
Finally, once you’ve been approved for your first loan, it’s usually a very simple matter to ‘refresh’ your loan again if you find you need to make use of the facility if funds are again short in the future.
There are, however, two major downsides to payday loans which you rarely see mentioned in the advertisements and web sites promoting them. Firstly, they’re very expensive compared to other forms of credit. Because the term of the loan is so short, a fee of 20% of the amount you borrow – which is about standard – will work out to be an eye-wateringly high APR.
The second problem is closely related: because they’re so expensive, you can easily be left short of money the next month once you’ve cleared the loan and paid the fee. In this scenario, it’s just too easy to refresh your loan again to cover the shortfall, resulting in more fees, and a never ending cycle of borrowing.
So, if you decide that a payday loan isn’t a good choice for you, what alternatives do you have? The first one is making use of a credit card, if you have one. While credit cards are usually also pretty expensive forms of finance, they do allow you to spread the debt over a number of months rather than needing to be repaid straight away along with a fee.
Many bank accounts now offer an overdraft facility, which can also be used to cover a short term lack of money. The interest rate on an agreed overdraft is likely to be better than that of a credit card, but your bank may not approve your application. Beware of going ahead and overdrawing without your bank’s agreement, as the charges they will levy in this case will be very expensive.
If neither of these options is available to you, and you have no other way of getting hold of money such as borrowing off family, then a payday loan may be the best option. Just ensure that you use it properly, and heed the warning sign it’s giving you about the longer term state of your finances.
Axis Bank Home Loan Interest Rate
Getting a good deal on your home loan is the toughest task for any consumer. Axis Bank home loan is a saviour in such a scenario, offering quick and easy options to buy your dream home. Their housing loans are designed in a way that perfectly suits the requirements of a modern home buyer; with features such as an option to choose from floating and fixed rate of interest, attractive interest rates, balance transfer facility, and doorstep service. Moreover, they are regarded as the best home loan providers in India, owing much to a myriad of additional features like flexible tenures, quick service and transparent processing. They even offer you pre-allotment booking finance for booking your dream home.
While deciding on a home loan, a major governing factor is the interest rate. A higher rate of interest means a higher EMI. Axis Bank home loan rates are the most attractive in the market, in an attempt to keep your EMI under your reach. Floating home loan rates range from 10.75% per annum to 12.00% per annum at present. As the rates tend to fluctuate, it is not easy to fix a monthly budget. However, floating home loan rates are at least 1% to 2% cheaper than fixed interest rates, thereby helping you save money in the long run. An alternative option is to go for a fixed rate loan, if you are unsure of market trends and want the security and certainty offered by a fixed rate. This way you need not worry about your budget being affected, since your loan interest rate is locked at a fixed value for a period of time. The current fixed rate offered by Axis Bank is 14% per year. You may switch between the two schemes of floating rate and fixed rate. Rescheduling of loan to a lower interest rate is also possible.
These home loans can be availed for both the purchase of land and construction of house on it, construction of a house on a plot already owned and purchase of a new house. They can also be availed for extension, renovation or repair of a house owned by the customer. Axis Bank also offers takeover of an existing home loan.
These home loans can be applied for a maximum of 85% of the property value in case of home loans and 75% of the property value in case the customer wants an extension, renovation or repair. These loans can be availed for a maximum tenure of up to 25 years. The bank even provides loan to NRIs for purchasing a ready to use residential property.
The attractive features of the Axis Bank home loans are not limited to the above. The bank charges a nominal processing fee of 1% of the loan amount. That is among the lowest in the market. Even getting yourself out of the loan has never been as easy as with Axis Bank. This is probably the most attractive feature of these home loans. Unlike other banks that levy a 2% early redemption charge, Axis Bank allows you to prepay the loan whenever you want. This really shows how much the bank values its customers.
If you are planning to buy your dream home, Axis Bank home loans is a one stop solution to all your needs. You definitely do not want to let go and end up paying more, turning your home loan into a nightmare.