PayDay Loan Calculator
How Much Do PayDay Loans Really Cost?
PayDay Loans or Short-term loans of this nature, are some of, if not the most, expensive ways for Canadians to borrow money. These types of loans, in certain circumstances, can serve a purpose, if it is a one-time thing, or a rare occurrence. Continued and repetitive use of these types of loans usually starts a downward financial spiral that most people cannot recover from, and/or they only delay the inevitable. Statistics Canada confirms that if used on a repetitive basis, that this usually is a tell-tale sign that a person’s financial affairs are in such poor shape that they need professional help to start over. In most cases, this means a bankruptcy.
Our Calculator Shows you the Effective Interest Rate for these Types of Loans
Simply enter the amount you intend to borrow, the cost of the loan fee charged by the provider, usually expressed in dollars per hundred, and the term or length of the loan in days.
Enter these three variables, and you will see the effective minimum interest rate being charged on the loan.
If You Dont Pay These Loans Off, Costs Escalate!
The cost of these loans, if you can’t pay them off in the stipulated timeframe, mushroom, as, in addition to their initial loan fee, these institutions usually charge additional extension fees or renewal fees, and another loan fee. By the time we see people who have used these types of services on a repetitive basis, they have few options but bankruptcy. More often than not, they have effectively paid these loans off one or even two times over, and their original balances have changed little.
Both Canadian and Provincial Regulators are currently investigating the seriousness of these situations and are drafting or considering amendments or stiffer enforcement of existing legislation to deal with the perceived abuses by some well-known service providers in this industry.