Anyone familiar with payday loans?

I tried to look into these shops several years ago. But they did not have franchises in my state--they were all company owned stores.

What do you want to know?
 
out of control APR.

Your loan is advanced ahead of your paycheck. So you get 'paid' early, but again with all the fees and interest tacked on, it eats away.

However if you do own your own shop, it can be very profitable...or at least a nice side source of revenue.
 
you can always ask that question in Google next time to get more relevant results :)

Anyway:

"Payday Cash Advance Loan

Payday loans are short-term cash advances designed to meet your emergency financial needs. Payday loans are also perfect for those times when you need a little extra cash for unexpected bills or special occasions. The fee for a cash advance is $25.00 for every $100.00 borrowed. For example, loans in the amount of $300.00 have a payback amount of $375.00. Payday loans are generally paid back within two weeks, however, you can extend the payday loan. To extend a loan you simply make at least the minimum payment owed on the cash advance. First-time borrowers of payday loans can request up to $600.00."

the 25/100 is fairly typical..as explained above, calculated out makes it a ridiculous APR.

Usually done for low credit/lower income class people.
 
payday loans type business is the fastest growing segment in the financial industry. that's what i heard few months ago. but like any other industry one should get familiar with real tools and tricks of the trade before venturing in. :D
 
Trader, I'm actually in the process of starting a payday loan company here in my state. Still waiting for my license to get approved.

Most places charge 17.5% of a loan..this is the maximum by law, but I'll under-cut everyone :)

kon
 
You can make some serious coin in this biz. But you face two challenges (and they aren't what you think).

1. Liberals. Since you are making serious coin and your customers are poor folks and you are helping them out, the liberals hate you. Generally not a problem by itself, but they pass laws limiting how much you can charge (fees and interest). If you are still in business then they just make payday lending illegal and you have to close up shop.

Which brings up problem #2:

2. Closing up shop. While you have an ongoing operation, most of your biz is repeat customers. They know they can rip you off - once. Then they cannot borrow again. So most folks pay you back. But once the word is out that you are closing up shop, they're not coming back to pay you.

Moving thread to CC.
 
i have a friend who has invested a large sum of money with a local payday loan company(200k plus). they are paying him 10%.
i tried to do some research on the risks to investors but pretty much came up with nothing. not much information out there.
 
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