Avoid Lenders with No APR Disclosure

Posted by on Jun 17, 2006 in Tips

Avoid Lenders with No APR Disclosure

When searching for a payday loan, avoid lenders who do not disclose Annual Percentage Rate (APR).

Lenders who try to hide APR are unethical. Would you enter into an important financial transaction with an unethical company?

In order to see why APR is important, we should have an understanding of what APR is and why it was created…

What is APR?

APR (Annual Percentage Rate) is a standardized expression of the effective interest on a loan.

Is APR required?

Yes. In the United States, lenders are required to disclose APR before the loan application is finalized.

Why was APR created?

APR was created to make it easier for borrowers to compare lenders and loan options.

Lenders who do not disclose APR:

  • do not want you to make an informed decision / fair comparison
  • tend to pitch benefits such as speed and ease while hiding real costs
  • usually will invite you to ‘extend’ the loan by paying only the interest effectively multiplying their profit at your expense

Payday loan companies with complete APR tables on their websites:

  • want you to make an informed decision / fair comparison
  • will tell you that payday loans are intended for emergencies
  • will warn you that cash advances should only be used as a last resort
  • will advise you to consider other options
  • tend to be ethical companies that care about customers

Please use the Payday Loan Calculator to check the APR. If the APR value differs from the one given in the lender’s APR chart, there may be hidden fees (e.g. $10 transaction charge or other fees). Read the terms and conditions carefully before entering into any loan agreement.

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