Pay your bills late
In theory, the purpose of a payday loan is to guide you through a temporary money crisis. If you need a stack of bills on Monday, but you can only pay for your next salary on Friday, a payday loan looks like a good way to close the gap.
In many cases, however, it is better to just wait until Friday and pay those bills late. You will often have to pay a fee for it, but not always. For example, utilities such as the telephone company and the electrical company often accept late payments. If you are unsure whether yours is working, call to ask.
Even if you have to pay a fee, this is often less than the cost of a payday loan. The average price for a two-week payout, $ 375, is $ 56, 25. However, this is how other late allowances accumulate:
- Credit cards . Rules approved by the Federal Reserve Board in 2010 set limits for payment arrears on credit card accounts. The bank that can charge the most is $ 27 for a first offense, or $ 37 if you’ve been late.
- Mortgage payments . If you pay for your mortgage, most lenders charge you 4% to 5% of the payment as a late payment, according to Nolo. And The Motley Fool calculates that for people with an income up to $ 50,000, the average mortgage payment is $ 615 or less. So the average fee for a late mortgage payment is no more than $ 30, 75. In addition, most contracts give you a grace period of 10 to 15 days, so if your payment is only a few days late, there are no costs at all.
- Rent Payments . Tenants also pay a fee for late payment of their rent. According to RentLaw, most courts are of the opinion that a reasonable fee for charging landlords is a maximum of 5% of the rent. So for a rental payment of $ 600, the fee would be $ 30. Some states say that landlords cannot claim compensation at all until the rental is 5 to 10 days late.
- Car payments . There is a similar rule for car loans. According to CarsDirect, most banks do not charge late fees on car payments until they are 10 days late. The Center for Responsible Lending says that a typical late fee for a $ 300 car payment is $ 15. However, costs can vary greatly, so it is important to check your contract. Also ensure that your loan remains unpaid for more than 30 days. At that moment, the lender can take back your car.