A payday loan, also known as a cash advance, is a small loan that typically must be repaid on the borrower’s next payday. In South English, Iowa, payday loans are legal, but they do come with some regulations that borrowers should be aware of.
Regulations
In Iowa, the maximum amount that can be borrowed through a payday loan is $500. The loan term cannot exceed 31 days, and the annual percentage rate (APR) cannot exceed 15 percent for the first $100 borrowed, 10 percent for the remaining amount up to $250, and 7.5 percent for the remaining amount up to $500.
Borrowers may only take out one loan at a time from a given lender, and lenders cannot charge more than $15 for a $100 loan. There is also a database in Iowa that tracks payday loans, which means lenders must check the database to ensure a borrower doesn’t have more than one outstanding loan at a time.
Benefits of Payday Loans
Payday loans can be helpful for those who need cash quickly. They are typically easy to obtain, and lenders don’t usually require a credit check. This can be especially beneficial for those who have poor or no credit. Additionally, payday loans can be useful in emergency situations, such as when a vehicle needs repairs or a medical bill needs to be paid.
Drawbacks of Payday Loans
While payday loans can be helpful in some situations, they also come with some drawbacks. One of the main drawbacks is the high interest rates and fees. This can make it difficult for borrowers to repay the loan on time and can lead to a cycle of debt. Additionally, lenders may encourage borrowers to take out bigger loans than they need, which can make it even harder to repay.
Interesting Facts and Statistics
- According to Iowa law, lenders cannot pursue criminal action against borrowers who default on payday loans.
- In Iowa, the average payday loan is approximately $320.
- The payday loan industry generates over $50 billion in revenue each year.
- On average, payday loan borrowers roll over their loans eight times per year.
Apply Now
If you’re in need of a payday loan in South English, Iowa, TheGuaranteedLoans can help. As a connector service, we work with a network of potential lenders to help you find a loan that meets your needs. Simply fill out our online application to get started. Remember, payday loans should be used sparingly and only in emergency situations. Be sure to read all terms and conditions carefully before accepting a loan offer.