Not
ready to close your business? Proven steps for turning failing
business around.
Some business owners feel as though they are against a wall with
debt and contractual obligations. They are exhausted. Their leases,
loans, and contracts pile up, while their money dwindles. Their
business is ruling their life and they just want to get out.
As a frustrated business owner, you may find yourself in this
situation. You may have tried to turnaround your failing company
with little success. And if you have no buyer on the horizon, you
may have decided you've had enough. It's time to close your doors.
But how do you go about doing this? You will find rows of books
at your local bookstore that cover how to start a business, but
little on how to close one. How will you meet the obligations of
your loans and lease? Do you owe money to the IRS, individual agencies,
or contract workers?
There are many items to consider when you close a business. And
you have some choices to make when it comes to getting rid of debt
and folding your company. Let me explain.
Straight
talk about business bankruptcy and closure
Payday Loans, A Viable Option? What are payday loans?
Payday loans are short-term loans that are extended between two pay days. A payday loan is normally provided for 14 days. The borrower, on acceptance of the loan conditions, provides a check favoring the lender as security against the loan. On the due date, the lender deposits this check to recover the loan dues. The due date is generally the next pay day of the borrower. No credit checks are conducted for granting payday loans. Therefore, the FICO score of the borrower is irrelevant. It doesn’t matter whether the borrower has a bad credit history, or has no credit history, or has declared bankruptcy.
Qualifications for payday loans
To qualify for a payday loan, the borrower needs to fulfill all of the following conditions. There are no exceptions.
• You must be a US citizen.
• You must at least 18 years of age.
• You must be at a full time job currently and must be at this job for at least three months.
• You must either have an active checking account or a savings account.
• Your after tax salary should be at least $ 1,000 or you must have a fixed income of $800.
Cost of payday loans
Payday loans carry a very high cost. Generally the lender fees for a $ 100 payday loan is anywhere between $15 and $25. It should be remembered that this fee is for 14 days as the loan itself is extended for these many days only. If one considers the cost on an annual percentage rate (APR) basis, the average is 391%, which by any standard is exorbitant. By law, it is mandatory for the lender to specify the APR to the borrower. Many lenders do compare the cost of payday loan against other forms of financing; but the common denominator of such a comparison is that all of them are very expensive.
When to avail of payday loans?
Payday loans should be availed only during emergencies. Considering the fact that the cost of carrying a payday loan is very high, it should be a resource of last resort. If one implements good budgeting techniques and has a good financial plan, the need for borrowing by way of payday loans can be minimized. Moreover, one must ensure that a payday loan is paid on time. Payday loans should not be rolled over or extended as within no time the borrower will find himself or herself in a debt trap where money may have to be borrowed just to repay the interest.
Profile of a payday loan borrower
• A typical payday loan customer is between 25 and 40 years of age with an annual income anywhere between $ 25,000 and $ 50,000.
• According to the US Census report of Year 2000, the results of the payday loan borrowers survey are:
22% of those surveyed hold a bachelor’s degree.
51% of those surveyed have a retirement savings plan.
In excess of two-thirds of those surveyed have a savings account.
More than two-thirds of those surveyed have an annual income of at least $ 25,555.
Why are Payday loans popular?
They are popular for a number of reasons such as:
• Credit checks are not required. The personal check that you make payable to the lender acts as security.
• Approval is quick. If all the necessary documents are submitted, your loan application maybe approved in minutes.
• The paperwork involved is simple. Generally one or two documents would suffice which explains the loan process and your obligations.
• The repayment process is without hassles. The check submitted as security is encashed on the next payday by the lender. You could extend the loan to subsequent paydays for a fee. However this is very expensive.
• Easy availability. Payday loans are particularly appropriate for emergency situations provided the amount required is small and one is willing to bear the high cost of the loan.
In summary, payday loans might be a viable option if you need cash and need it fast. You still should be careful who you are working with to obtain your loan. If you don't need money right away, there is probably a better solution for you.
About the author:
John Williams writes about payday loans at http://www.paydayer.comCheck out that site if you have any questions about that type of loan.
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Straight
talk about business bankruptcy and closure
Five Tips When Choosing a Credit Counselor
If you are faced with bankruptcy and need to deal with a credit counselor, beware. Some are legit and some are just scam artists taking advantage of your weakness. 1. Face-to-Face Advice. Find someone you can see and talk to in person. You can get advice over the phone and on the Internet. The best place is to get a face-to-face result. You want the best advice possible. You can go to the university, military, credit union, list at US Department of Justice website. Sit down face to face for the best results. 2. Beware of High Fees. If they have high fees, avoid them. Some of them . . .
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