Beware Of Bad Credit Payday Loans

Could bad credit payday loans be the answer consumers with low bank accounts have been looking for? Is there any harm in using these services? Aren't they better than using credit cards or going hungry?

Have you seen the commercials? Cute characters promise financial prosperity. Happy, professional individuals appear to regularly visit their corner pay day loan shop as proudly as cashing a check at the bank. Customers at the grocery store all recommend
pay day loans as the easy solution for a lack of funds.

WHY USE A PAY DAY LOAN?

Some individuals reason that paying a bill with borrowed money is better than receiving bad credit marks because of not paying the bill. This is understandable. However, some financial institutions are willing to make the occasional exception if
contacted about the situation. Or there may be a small fee, but not a credit report made.

Using it for groceries or other items? Consider the true cost before making a decision. Compare the cost of using a pay day (or cash advance) loan to the fees charged for taking a cash advance on your own credit card. Can family help? Often those who are forced to use pay day loans are not able to repay the loan by the next pay check and that can lead to a cycle of debt and stress.

WHAT IS THE COST?

Several sources, including a consumer report by the FTC (Federal Trade Commission) and the CFA (Consumer Federation of America) state that usual the usual APR is between 350 - 650% with some as high as 780%.

A loan of $100 ranges in cost between $15 - $30. If the loan is not repaid by the pay date then it can be renewed with another fee due at each renewal. A loan of $100 can cost $60 in fees after 3 renewals.

WHO BENEFITS?

Based on the warnings issued by federal and consumer organizations it is clear that using pay day loans or cash advances from these businesses can often lead to more debt and problems. Some sites were reported to automatically roll over the loan and only withdraw the renewal fee on the pay date. Other sites surveyed by the CFA required customers to agree in contract to not participate in class action suits or to file for bankruptcy.

For those who are having debt problems it is recommended to seek no- or low-cost credit counseling from a local non-profit organization. These organizations can help with reducing current interest charges and lowering monthly payments. If the problem
is budget, you should look to a financial planner who can help you to manage the money you do have and avoid using credit at all.

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Positioning in Small Business Marketing

Positioning is another one of those marketing jargon words that everybody throws around and is important to understand. It's also important to understand how positioning specifically applies to your small business marketing.

Basically a marketing position describes your unique place in the market. The key word here is unique. What makes you different from your competitors? What features and benefits do you offer your target market that the other players don't?

Here are a few things that may go into your positioning:

-Price Point - This doesn't necessarily mean you have the lowest price. You may be the most expensive in town, and that's OK if you convince your customers you're worth it.

-Service - Almost every business claims they have great service. If you can provide exceptional service compared to your competitors, your customers will remember you. I'll never forget calling a surly plumber to try to get him to my house for an emergency on a weekend. he acted like he didn't want my business and then told me it was going to be $200 for him just to show up, no thanks. I called roto-router who gave me amazing service, a guarantee, and the whole bill was less than $200. I now use them for all my plumbing.

-Features and Benefits - Positioning is not just about what makes you different, it's also about what you emphasize. Folgers announces to the world that it's "mountain grown coffee" ( a feature). Guess what? All coffee is mountain grown. Folgers just claimed this feature first. What's something that none of your competitors are talking about?

-Credibility - Legal Seafood's clam chowder is served at every presidential inauguration. Many products get celebrity endorsements. Many companies tout how long they've been in business. All of these things build trust in the mind of the consumer. What trust-building factors do you have that the competition does not?

-Negative Features - Is there something you don't have that annoys customers of your competitors? I'm not saying use negative advertising, but just mention the feature and tie it to a benefit. I'm annoyed when I have to pay for parking to go shopping at Mall. Instead of touting free parking, a mall that wants to speak to me might declare, "you'll never have to pay for parking". This drives home the pain of shopping with a competitor without going negative.

-Anything Else - Literally anything that differentiates you from your competitors can be part of your positioning strategy - your location, your hours of operation, the way your office smells. Small business owners need to think creatively here.

In a great article by John Jantsch he states that a positioning strategy must answer the question, "why should I buy from you?" This is brilliant in it's simplicity; it cuts through all the strategic junk that complicates marketing. If you can't answer this question, your customer is not going to do the work to figure out an answer on his own.

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