San Francisco is located in Northern California and the San Francisco Bay. The current population is 884,108. There are 757,421 adults, (138,157 of whom are seniors). San Francisco is also the 4th most populous city in California (behind Los Angeles, San Diego, and San Jose). The median age is 38. The average household income is $160,396. A poverty rate of 10.12%. The rate of issued payday loans in San Francisco is 51%. The median rental cost is $2,010 a month, and the median house value is $1.15 Mn. 38.0% is the rate of home ownership.
What are payday loans in San Francisco, California?
Payday loans in San Francisco, California are a great alternative to bank loans. They have the following features:
- small amounts are issued for a short period of time;
- higher interest rates as a payment for the risk of a microfinance organization;
- certificates of official employment and income are not required;
- as a rule, you do not need to visit the office in person to get deposited;
- you can apply online;
- much higher probability of approval;
- credit history doesn’t really matter.
That is, a payday loan should be taken out when a small amount is needed for a short period of time. This financial product has only one drawback – a higher interest rate, but you need to understand that the percentage of non-repayable loans from MFOs is much higher than in banks, besides, an unemployed person or a pensioner can get money, which means the risks of MFOs are much higher, hence this rate exists.
What should I pay attention to when issuing a payday loan San Francisco, CA?
A balanced decision. It is necessary to study the terms of loans in several lending services, as well as choose the right repayment date – it is optimal if it occurs 3-4 days after the payday. When paying off several loans at once, it is necessary to plan payments for them in different periods of the month in order to distribute the debt load between the paychecks. Keep in mind such a burden should not exceed 30-40% of the monthly income of the family.
The full loan cost. Each borrower should carefully read the rules of the lending service, as well as the payday loan agreement. Such an agreement must necessarily contain information about the full cost of a small loan, which cannot exceed the average market value.
Timely repayment. Experts advise using only proven methods of transferring money and saving all checks and documents. To avoid possible disagreements, with the full repayment of the debt, you need to take a certificate confirming this fact. If the loan cannot be paid on time for any reason, you need to immediately notify the lender about it: if there is a valid reason (loss of work, illness), you can get a deferral. However, this is not the responsibility of the organization. In addition, the borrower can repay the issued loan ahead of time, then he pays interest only for the actual period of use of the funds.
Payday loan goals
A payday loan San Francisco, California is issued for any reasonable expenses necessary for the implementation of consuming and entrepreneurial activity, except for the repayment of overdue tax payments, overdue arrears to employees on wages, repayment of arrears to participants (founders) on the payment of income, redemption of shares of participants (founders) in the authorized capital.
Almost all residents of California can apply for a payday loan. The requirements are very loyal:
- age from 18 to 65 years old.
- the presence of citizenship of the United States — you will have to show your ID.
- the borrower must be a client of any American bank. The money is deposited to a registered bank card. And it does not matter whether it is debit or credit.
- access to the Internet and contacts. You will receive confirmation codes by email and phone, which you will need to enter on the website when filling out the questionnaire.
Peculiar features of a payday loan
As a rule, clients of microfinance organizations (MFOs) are people who are denied a loan by banks. Most often this happens if a person cannot confirm his solvency or had problems with the credit history. Banks carefully check their customers and refuse if the risk of non-repayment of debt is too high.
MFIs are more tolerant of risk and are ready to give money to many of those who were refused by banks. However, for the increased risk, they set a much higher price on their loans. That is why the rates under the loan agreement are always higher than in the bank. Thus, MFIs offer their clients what banks cannot offer them, but for a higher fee.
How does a payday loan differ from a loan in a bank?
Key differences between a consumer loan and a payday loan are:
- The first difference is the amount of interest for using borrowed funds. Practice shows that the bank, when concluding a loan agreement, sets a much lower percentage than microfinance organizations. At the same time, according to the law, MFOs cannot set a rate higher than 1% per day.
- The second difference is the term for which the loan agreement is drawn up. In the bank, you can get a standard consumer loan for a period of 1 year or more. MFOs specialize in short loans and issue money for a period of 5 to 30 or max. 60 days. Most payday loans in San Francisco are issued for up to 1 month. In some similar organizations, you can apply for a loan for several months if they offer such an option.
- The third difference is the loan amount. Banks issue loans for large amounts. If you have a good credit history and a sufficient level of income, you can get a consumer loan in the amount over $5,000. The risks of non-repayment for MFIs are noticeably higher, so they only give out small amounts.
- The fourth difference is the simplicity of the application. Microfinance organizations can issue a loan with one ID as soon as possible. Issuing a loan in a bank is a longer process, and if we are talking about a large amount, additional documents may be required that will confirm the client’s solvency.