Personal Loans and APR

When you are considering taking out a personal loan you will be influenced by payday loan critics who throw out astronomical APRs at you. Don't be fooled. Here's the truth.

A personal loan is a short-term cash advance secured against your next paycheck. Paychecks come for most Americans every two weeks. This means the longest the loan term can be is 14 days. That's how a personal loan is designed to be.

So figure in an APR of 365%. This sounds high, right? Well, if the ANNUAL percentage rate is 365%, what does that make the DAILY interest rate? It's a whopping 1% each day. So what's that mean you pay during your 14 day term? 14% of the principal.

So if you have personal loans for $100 at 365% APR, should you worry? Of course not, personal loans of this nature cost you $1 per day!

Keep in mind if a bank offer you $5,000 at 20% APR, you will probably get a 3-5 year term. If this is the case, over 5 years you pay 100% interest, or in other words, you borrow $5,000 now, but it costs you $10,000 over five years. Sound like a good deal? Of course not, the APR is much lower, but the term of the loan is much longer.

So be careful when getting a loan. Look into the APR, the principal, the term, what the interest will be, etc. It's in your best interest to know what you're getting into. But don't be scared to get a personal loan. They can help in times of need and they are easy to get, even if you have bad credit. Banks typically won't offer personal loans for people with bad credit but a payday lender will.

Remember- the APR means nothing, you are only concerned with the actual amount you will pay in interest, which is always very reasonable when acquiring personal loans.

Personal Loans Zone

A great website offering personal loans online . You can get a great cash advance personal loan even if you have bad credit.