Payday Loans 101: Terms You Need To Know

Payday Loans 101: Terms You Need To Know

Look, we get it. The jargon associated with payday loans and the financial industry, in general, can be confusing, especially when we throw in abbreviations. We want to help you better understand payday loans, so we created a handy cheat sheet for all the terms you need to know!

Payday loan

A payday loan is a small amount loan that is meant to be paid back with a fee within 2 to 4 weeks. Think about it like renting money! To make things easy to understand, let’s use a leaf blower in this scenario. Say you are short on cash…rather than going to Home Depot to buy a $300 leaf blower, you decide to rent a leaf blower for $50 a day for 6 days. When you are done with your yard work, you return the leaf blower plus $300 ($50 x 6 days) in rental fees. Although you ended up paying the same amount as you would have if you had purchased it, renting it allowed you to get the leaf blower when you needed it, and it allowed you more time to spread out your money. This same thought process applies to a payday loan! You can learn more about what a payday is here

Principle Amount 

The principal amount means the amount you owe at any point in time. It’s essentially your loan amount when you first take out the loan. 

Finance Charge

This is 20% of the principal amount that is charged as a one-time fee for a payday loan. 20% is the legal amount that a payday lender can charge. Say you get a $100 loan, your finance charge will be $20. View the finance charge on Quick Cash 4 Less loans at https://quickcash4less.com/wp-content/uploads/2022/07/QC4L-Rates-Chart.pdf

APR 

APR is short for Annual Percentage Rate and refers to the interest rate generated throughout a whole year. You’ll hear this a lot around payday loans; however, it is often misconstrued. Click here to learn more about APR and payday loans. 

Refinance

Refinance is to finance (something) again, typically with a new loan at a lower rate of interest. At Quick Cash 4 Less, we allow you to refinance and will work with you to protect your credit and help you pay back your loan. We will waive fees so you can get back on track and remain in good standing. 

Doc Fee

Short for Documentation Fee; This is a fee for preparing documents, paperwork and handling. Our Doc Fee at Quick Cash 4 Less is always $10, no matter the amount you are borrowing.