Cheap Personal Loan - Does It Maike Sense?
What would be the benefits to a cheap personal loan? Well duh! If you pay less for the money in the first place it will be easier to pay it all back! Its America, land of bargain shopping, and if we can save a few dollars here and there we'll gladly take the opportunity - even if it means agreeing to a loan that might not work as expected.
The cheap personal loan - beyond the first glance
When it comes to consumer advocacy of payday advances, everyone wants the same thing - a cheap personal loan, a payday loan charging significantly less than what they charge today. Ok, lets say tomorrow the lenders give up and agree to provide only cheap personal loan opportunities - what would happen?
- At first, nothing. People who needed fast financial assistance would apply for the same loans they've been applying for for years. They'd be happy! Saving a few bucks by getting a cheap personal loan is better than paying a higher price - but it really would be business as usual. For a while at least.
- After a while, more and more people who avoided cash advances because of the high fees would start getting in on a cheap personal loan - and more and more people would discover that no matter how affordable these loans they are still monsters to repay with that first paycheck. Roll overs would drastically increase, as would the hits against credit and the dreaded write offs.
- Finally, the lenders would have to sacrifice something - both due to an increased level of clientele and in the fact that they are profiting less. What would be the first to go - speed? Security? Take your pick.
The high expense of payday advances serves a dual, yet unintended, purpose: it keeps the number of applicants at a minimum and it forces the lenders to provide excellent services. Make a cheap personal loan the rule rather than the exception and you'll take away those barriers and benefits.
The Cash Loan Crisis will not be solved by forcing lenders to provide a cheap personal loan.
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