South Carolina Payday Loan Source
Fast cash loans or Payday loans have a bad reputation, which is largely deserved because they are very expensive. Yet, while payday loans have many downsides, they can also be a viable solution to a serious financial problem when no other solution exists.
A payday loan is a short - term unsecured loan. The purpose of the payday loan is to allow someone to borrow money until he or she receives their next paycheck. This allows people to meet expenses that come up that cannot wait. A person who needs his car to get to work, for example, could not afford to wait until payday to get the money to do a necessary car repair to keep the car running. Other types of loans such as bank loans are not intended to meet these short - term needs and while credit cards can sometimes provide a solution, they are not available to everyone and will not work in all situations.
Payday loans are also loans that are designed to be easy to qualify for and obtain. Unlike with most loans, you can get access to quick cash right away when you take out a payday loan. You can also get a payday loan even if you have credit problems and a low credit score resulting from past debt issues. As long as there is a bank account available to you and as long as you have a job and income, you should typically be able to qualify and obtain a payday loan.
The fact that people can get these loans to deal with short - term emergencies, even with bad credit, means that payday loans provide a lifeline to many who really need a way to meet short - term expenses.
Unfortunately, payday loans do this in a very costly manner that many view as predatory. Payday lenders charge a very high fee for lending money. Because the loan is for a small amount of cash and because the money is lent on a very short - term basis, the high fee results in a very high APR (annual percentage rate). This is how the true price of borrowing money is measured, even if you pay back the loan in less than a year. Comparing the APR of payday loans - , which can exceed 450 percent with other lending products such as credit cards with an APR of 30 percent or less - , makes clear why many people view payday loans as a predatory lending product.
Payday Loan Laws in South Carolina
Lawmakers in South Carolina have passed consumer protection legislation intended to make sure that the public does not suffer harm as a result of abusive payday lending practices. The laws are found in South Carolina Code sections 34 - 39 - 110.
According to South Carolina fast cash loan laws and restrictions on payday laws, the maximum loan amount that can be borrowed in a payday loan is $550. The loan tenure is 31 days and the maximum fees and finance charges cannot exceed 15 percent of the principle. Since this is a short - term loan with a 15 percent fee and finance charge rate, this means that you may have an annual percentage rate of 390 percent on a 14 - day loan for $100.
There are no limitations or specifications regarding the maximum number of loans that a person can have outstanding, nor does the law address rollovers.
Stay Educated About Payday Loans
Payday lending serves an important role but it is important to recognize the downsides. Fast cash South Carolina laws have tried to address some of those downsides and provide certain protections to the public through their payday lending laws. This doesn't mean that they have made it cheap to take a payday loan, but you are at least benefitted by the limits on interest and loan amounts to help keep you from getting in over your head financially.
Understanding the limits on South Carolina payday laws helps to ensure that you make an informed choice about any loan products that you take on.