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Today, almost everyone is short of funds, from time to time. Sometimes this means a short period of discomfort, but sometimes it can be devastating. Having to repair a furnace in winter, for example, is an emergency that can not be put on. But where can you get the money to fix it, especially if you have already run through their savings for other emergencies?

If you have heard of payday loans "" and considering one of these then run, do not walk as much as you can from the storefront operations. Because of how the interest and fees are structured, you could find yourself in a cycle of debt that is almost impossible to escape.

A payday loan seems harmless at first and you can just borrow $ 100 with a cost of $ 17.50. This may sound very good when you need money quickly. However, if you can not pay when it comes you will incur additional interest that can reach a huge accumulated a total of more than $ 900. You may have to pay interest for months or years in this small loan of one hundred dollars.

Most credit unions offer alternatives to payday loans. These loans are usually for amounts under $ 500 and monthly payments are small. Interest rates are low, too, and there is usually no collateral needed.

If you're not familiar with credit unions, which are like banks but are not owned by a corporation. They are the property of their depositors. Their fees and interest rates are generally lower than the banks and their customers see as valuable resources, not cows.

Credit unions are safe, too, with the account of each depositor insured to $ 250,000 by the National Credit Union (NCUA). Because they are non-profit institutions, credit unions are exempt from income tax. This means they can afford to offer much better savings and interest rates that a bank made a profit for its shareholders. Credit unions often offer a free check and savings accounts and loan from a credit union will be a lot lower than a bank interest rates.

Most credit unions require that you live some distance to be a member. In the past, most credit unions have been sponsored by the workplace and membership is restricted to employees of the company. Now, the concept has gone a step further to include any person in a certain place, such as a city or county.

In fact, when a fund is doing well all share the profits. The excess earnings are returned to members (depositors) with high savings rates, lower spending and lower interest on loans.