1185031_pile_of_moneyHave you seen an advertisement for free payday loans?  Chances are, even if you have never needed a payday loan before that you have seen ads for free payday loans.  Companies use these ads to gain your attention.  The trouble is when you go to the site you quickly learn they were just luring you there.  You find out there is a fee and interest that is charged on that loan.  The answer to ‘are there free payday loans’ is not quite as simple as we make it out to be.  There is at least one company, National Payday Loan that will offer a partly free payday loan.

Let’s explore this in further detail so you can understand what we mean by a partially free payday loan.  Any loan company offering a payday loan is going to charge you a loan fee.  This fee can be anywhere from 1 to 30 percent of the loan amount.

Most companies use a standard 30 percent fee.  If you need $100 in a payday loan the fee will be $30.  This fee is non- negotiable and it is not going to be waived, ever.  Even National Payday Loan will charge you this fee, making the loan a partially free loan.

The free part comes in the interest.  Interest on payday loans is astronomical when you compare it to the amount you have taken in a loan and the other interest rates for lines of credit out there.  A credit card company may charge up to 35 percent on their credit cards, but this is rare.  Most credit card companies have an average annual percentage rate at 15 to 17.99 percent right now.  The only time you see extreme interest rate charges is when you default on the credit card and they increase the interest.

On a payday loan, you can see an APR of 300 to 1400 percent.  If you take a year to pay the loan back you would be paying out at least 300 percent more than you took out in the first place.  That is quite a lot of money when you do the math.  When a company like National Payday Loans is willing to waive the interest, you are essentially getting a free loan.

There are some very specific qualifications for this type of free payday loan.  If you do not follow the rules you will not qualify and therefore could end up paying the interest.  The first rule is to pay the loan on time and in full.  If you have the loan for 7 days then you must pay the entire amount plus the fee on that seventh day.  So, you would need $130 to pay the loan off based on the above example.  If you cannot pay this amount back in the 7, 14, or 16 days (these being the typical terms) of the loan, you would end up paying the interest along with the fee.

It is not impossible to find a semi-free payday loan.  However, you want to avoid getting caught up in the advertisement of some companies by thoroughly researching the options that are before you.  In other words, if you cannot pay the loan off in full it will not work as a free loan.  There is a second parameter you must follow.  This second rule is that it must be your first loan with the company, at least with National Payday.

If you are attempting to get a second loan the company may not be willing to make the same interest deal.  This is due to the fact that the company is in business to make money, and they do that through the interest being charged.  This is not a bad thing, but it is something you have to consider.

Still, when you research for free payday loans consider that by returning to the same company after the initial loan is paid they may be willing to deal.  Some companies reward loyalty by offering specials throughout the year.  It could mean they have a special for returning customers in which the interest rate is waived on your loan.

From the above information, it is easy to see there are definitely perks to payday loan companies.  You just have to take the time to research them and decide overall if the payday loan is something you can afford.  If you cannot afford to pay it back looking for a free deal is not going to help you because the option will be voided once you put it on a payment plan.

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