Payday Loans

Yet another reason why credit unions have an edge over the competition:

HARRISBURG, Penn. - A Commonwealth Court here has upheld a Pennsylvania Department of Banking requirement that payday lenders be licensed, including Internet payday lenders and any other out-of-state company that issues consumer loans to Pennsylvanians. The decision was applauded by the Pennsylvania CU Association, which noted that the Credit Union Better Choice program allows members to obtain short-term loans of $500 or less at an interest rate of 18% or less and an application fee of no more than $25. At the loan's disbursement, an amount equal to 10% of the loan is deposited into a savings account in the borrower's name. Lastly, all borrowers are offered financial counseling. That program is now offered by 82 CUs.

This product is not unique to Pennsylvania. Several credit unions in the state of Utah are offering short-term loans to provide cash for immediate needs through a program called CU on Payday.

Long-term loans combined with effective budgeting is preferred over these short-term, high-interest loans, but there are times when people need short-term cash advances for unforeseen expenses and/or emergencies. Using your local credit union to fulfill this need is always your best option.