Payday loans cost way too much

Posted by Lee Benhayon

How Much Do Pay Day Loans really cost?

In today’s tough economy, many Americans are frequently finding themselves backed into a corner financially.  When the rent or mortgage payment is due; property taxes need to be paid; or a someone just needs a little cash to get by until next payday; too often they find themselves accepting financial help that is not so helpful after all is said and done.

One of the most costly fast cash methods too often utilized by misinformed people is a so called “easy payday loan”.  These payday loans are small (usually around $200 dollars), temporary loans serviced through check cashing stores, or other quick cash advance lenders.  The process usually involves the customer writing a post dated check accompanied by a hefty fee.  Should a payday loan customer’s plans to pay back the loan backfire, the loan is then rolled over (aka “extended”).

Payday loans will surely require endless fees and high interest rates if the loan is not paid off as originally intended.  The cost of a payday loan roll-over averages around 426% per year according to The Consumer Federation of America. If a customer chooses to ignore repayment, it will be reported to ChexSystems and their credit will be ruined.  Many tales have also been told about payday lenders who harass customers for late or nonpayment.

Some states institute regulations limiting the amount of money a payday lender can loan to a customer.  There is often a maximum amount the lender is allowed to loan to a customer based upon the client’s income.  The only way for a payday loan to be helpful at all is if the borrower is disciplined and has the ability to repay the loan as scheduled.  Conversely, a person who is 100% confident they have the ability to repay the loan within two weeks as scheduled probably would not need a payday loan in the first place.

There are better ways to get money fast rather than turning to a high-risk payday loan.  Even a cash advance from a credit card appears to be a better option.  Unfortunately, many people today have been burdened with poor credit ratings and are unable to qualify for a credit card.  A much better quick cash alternative is a short-term collateral loan.  Anyone who has in their possession a valuable asset, such as gold, silver, platinum, loose diamonds, fine jewelry or designer watches, have everything they need to get a same day loan for less than 10% interest per month and no additional fees at Chapes-JPL.  Credit or job history is not important, and if a loan is not paid off, it will not affect your credit rating.

In the current economy, assets in the same category as a GIA certified diamond ring, Rolex wristwatch, mint coins, or jewelry are more valuable than the U.S. Dollar.  Therefore, selling fine jewelry, diamonds or precious metals is not in a person’s best interest.  However, using the same assets for a loan with a trustworthy and experienced private lender is a great way to get quick cash without paying ridiculously high interest rates and additional fees.

There are limitless pawn stores and other questionable gold buyers anxiously waiting for customers to walk through the door with their priceless treasures.  It is extremely important to do your homework before visiting a pawnbroker or direct lender.  First of all, the customer should already be fully aware of the current value of their assets.  If the potential borrower is unsure of the item they have available to pledge, it is best to get several appraisals on the item(s) before committing to a loan.  There are also tests available, such as acid tests for gold.

Other important factors to consider before committing to a short-term loan with a pawnshop or private lender are:

  1. What is the required monthly interest rate?
  2. How long will the loan be contracted for and what are the terms?  Are there penalties if the loan is not paid off as originally scheduled, such as additional fees or higher interest rates?
  3. Are principal payments allowed throughout the loan?  If so, what are the restrictions?
  4. Has a friend or family member done business with the broker or lender before? If so, did the lender work with the client to help him/her get their asset back, or was the asset instantly liquidated?

Chapes-JPL is Atlanta’s oldest and most trusted private lender and jewelry buyer.  The reasons listed above are exactly why our business was started more than 30 years ago.   Chapes’ founder wanted to provide a better fast money alternative for the people in Georgia rather than being forced to rely on seedy pawnbrokers or other greedy loan merchants.

We will buy valuable assets, but most often encourage clients to use them for a secured loan.  Our asset loans are never more than 10% interest per month and we highly recommend customers make as many principal payments as possible.  More payments towards the principal balance will keep costs down and allow the client to pay off a loan more easily.

Chapes-JPL customers are important to us and we want them to have loan leverage for years to come.  More than 80% of our clients return to us repeatedly after their initial loan and refer us to friends and family.  We now service clients nationwide and have added a second location in beautiful Boca Raton, Florida.  Pro-athletes and well-known celebrities also appreciate our discreet, safe and upscale lending approach.  Learn more about our jewelry loan and buying services by visiting us at

Payday loans cost way too much was last modified: April 25th, 2018 by Lee Benhayon