After rain comes sunshine. Do you unexpectedly have a financial windfall? Good. Then that payday loan that you needed so much could be paid back faster. But is that possible and under what conditions?
The main advantage of a payday loan is the safety that goes with it. After all, you can make few bad decisions because everything is certain and your situation is checked in advance by the lender. You know how much you have to pay monthly and how long the term is. The annual percentage rate (APR) is also known and was included in the monthly installment. When the loan is finally fully repaid, the story also stops here. The contract is over and you have no further obligations.
Pay back early
A possible disadvantage is that little flexibility is possible with a payday loan. Early repayment is only possible provided that paying a reinvestment fee and withdrawing the repaid capital at a later date is also not possible.
However, due to the low interest rate, the reinvestment fee is currently included. For example, this only costs 1% of the amount in capital that is repaid early if the term between the early repayment and the agreed end of the agreement is more than one year. And if the term is less than one year, 0.5% of the amount in capital that is repaid early.
A small example may tell you more. If you repay an amount of 5,000 euros capital early, you will therefore either pay 50 euros (still more than one year) or 25 euros (still pay less than one year).
The importance of comparing
Information retrieval and loan simulations can be done entirely yourself, you no longer have to go to the bank. Nowadays you can find everything online. You will be amazed when you start. In a short time you have compared several banks and you have the cheapest payday loan in front of you. You do not always realize that you can also save on a loan. Limiting the costs on a loan can make the difference at the end of the month.
These simulations are therefore important and the JKP should definitely be watched. This is necessary to secure a cheap payday loan and still be able to take out a loan with a good feeling. A payday loan always runs for a few years, so you will notice it on your budget that a large amount will always be deducted from your bank account. So when you take out that payday loan, make sure you have a stable work situation in order not to get into trouble.
However, do not just compare the cost price of the payday loan. Apart from the interest charged by a lender, the conditions can also vary. It is therefore important to read the so-called small print. Most websites of financial service providers also have a heading “Frequently asked questions and answers”. You will find, for example, the answer to the question of how much the reinvestment fee amounts to.