The Bottom Line
Small business is important to Central Oregon, and to Mid Oregon. Find tips and resources for business, and information about Mid Oregon’s commercial services and business members.
The Payday Lending Trap
You’re in a financial bind and need some quick cash. You’ve seen payday loan stores all over town and think “Maybe I should try that…”
The Payday Lending Trap
Don’t fall into that trap! Getting a loan with a payday lender could send you down a deep hole that may take years to get out of.
Here’s how payday lenders catch and hold consumers:
To receive cash, you write a check to them for the amount plus the finance charge, which the lender will cash the next time you get a paycheck. They’ll tell you finance charges range from $15 to $50 per $100, but won’t tell you exactly what the interest rate (or APR) will be. Interest rates can run from 390 to 780%, and if your state does not cap the maximum cost, the rates can be even higher!
Running the Math
Here’s the math to figure out what you’d end up paying by borrowing $400 from a payday lending store. There’s a finance charge of $50 and a 14-day term:
• Divide the finance charge by the amount you’re borrowing. $50/$400 = .125.
• Multiply the answer by the number of days in a year. .125 x 365 = 45.625.
• Divide the answer by the number of days in the term. 45.625/ 14 = 3.2589.
• Move the decimal point to the right two places. This is your APR. 325.89%
At the end of your 14-day term, you have to pay them $450. But if you can’t pay it off entirely, you’ll have to roll the balance over, pay another $50 fee, as well as interest charges. At the end of your second term, your balance is almost $600, and if you can’t pay that off entirely, you roll it over again. See how quickly your $400 loan can cost you thousands of dollars?
Alternatives?
So what are some alternatives?
* Ask your employer for an advance on your next paycheck.
* Consider asking family members or friends for a short-term loan.
* If you were a military servicemember, you may be eligible for short-term lending or emergency relief assistance. Contact Military OneSource at 800-342-9647, or visit www.militaryonesource.mil for information.
* A personal loan through Mid Oregon Credit Union. We offer loans with low, interest rates, flexible repayment term lengths and no application fees.
* Open a low-cost or no-cost, low-interest credit card through Mid Oregon Credit Union and use it only for emergencies. No fee is charged by the credit union for cash advances, and there is no balance transfer fee.
No one wants to find themselves in a financial emergency, but there are much better options than turning to a payday lender. To find out more about payday lending and learn about safer ways to get quick cash, visit the Consumer Federation of America webpage www.paydayloaninfo.org/consumer-help.
If you’d like help getting control of your spending, see us at Mid Oregon. We’re committed to helping our members gain financial well-being and offer one-on-one financial advise as well as additional resources to help you get control of your finances. Contact us through through email, phone ((541) 382-1795) or visit one of our seven branches for more information.
9 Ways to Save on Back-to-School Shopping
School starts in some Central Oregon school districts very soon. During August, Mid Oregon Credit Union hosts a supply drive called “Supplies 4 Schools“, in all 7 of our branches. Supplies are distributed through FAN in Deschutes and Crook Counties, and to the schools in Jefferson County, Mid Oregon members have always been very generous helping kids be ready for school.
Perhaps you are able to afford to buy supplies for your children, but savings money is still important. Getting kids ready for school is a major expense. According to the National Retail Federation, the average American household spends $688 on back-to-school shopping — 64% of it is spent on clothing and electronics.
9 Ways to Save on Back-to-School Shopping
Here are a 9 ways to save this fall and throughout the year. At the bottom of this post are links to Central Oregon school districts’ recommended supply lists.
1. Create a checklist of items and stick to it.
Before you begin shopping, empty your kids’ backpacks to see what was left over from the previous year. Mark them off your checklist and then buy only the items still remaining.
2. Consider shopping without the kids.
They’re more likely to fall for the strategically placed items stores want you to buy. Backpacks and notepads with your kids’ favorite superhero or Disney character can be 30% or more expensive than generic kinds. If your children insist they need Dory backpacks, buy stickers and have them decorate their less expensive gear themselves.
3. Comparison shop online before going into stores.
You’ll save on time and gas money.
4. Give your kids a clothing budget and a list of necessities.
You decide what items they must have, then with the remainder of the budgeted money, let them choose what they want.
5. Set up e-mail alerts for sales.
Websites like Dealnews.com, Bensbargains.com, and thekrazycouponlady.com will let you know when coupons or great deals are available for specific items.
6. Buy school supplies in bulk.
Although you’ll have a large initial expense, in the long run the supplies will be cheaper and you’ll have them on hand for several months.
7. Follow your favorite stores and brands on social media.
You’ll be one of the first to find out when they’re offering deals and special promotions.
8. Go to Garage and Yard sales for clothing.
Websites like Garagesalestracker.com, yardsalesearch.com, and Craigslist.org are great online resources for finding bargains in your area.
9. Wait until late August or September to buy your school supplies.
That’s when the prices drop significantly. You can even buy for the following year.
Central Oregon School District Recommended Supplies:
Some districts and schools have not yet published lists of school supplies needed. Read this post for the FAN recommended school supplies most needed. Check their websites for more details.
- Bend-La Pine School District
- Black Butte School District
- Culver School District.
- Crook County School District
- Fossil School District
- Gilchrist School (Klamath County School District)
- Jefferson County School District (School Supply List)
- Mitchell School District
- North Lake School District
- Redmond School District– Including Redmond Proficiency Academy (School Supply List Page)
- Sisters School District (Back to School Information Page)
- Spray School District (School Supply List)
Private School Websites:
Credit Blues? Things To Improve (Part 2)
For the first 4 of ten things you can do avoid the credit blues. To improve your credit score, read this prior post, Credit Blues? Things You Can Do To Improve! (Part 1).
What can you do to improve your score?
The Federal Trade Commission (FTC), on their Consumer Information webpage on “Credit Scores”, provides this informative recap:
Credit scoring systems are complex and vary among creditors or insurance companies and for different types of credit or insurance. If one factor changes, your score may change — but improvement generally depends on how that factor relates to others the system considers. Only the business using the system knows what might improve your score under the particular model they use to evaluate your application.
FTC Credit Report & Credit Score Information
Nevertheless, scoring models usually consider the following types of information in your credit report to help compute your credit score:
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- Have you paid your bills on time?You can count on payment history to be a significant factor. If your credit report indicates that you have paid bills late, had an account referred to collections, or declared bankruptcy, it is likely to affect your score negatively.
- Are you maxed out?Many scoring systems evaluate the amount of debt you have compared to your credit limits. If the amount you owe is close to your credit limit, it’s likely to have a negative effect on your score.
- How long have you had credit?Generally, scoring systems consider your credit track record. An insufficient credit history may affect your score negatively, but factors like timely payments and low balances can offset that.
- Have you applied for new credit lately?Many scoring systems consider whether you have applied for credit recently by looking at “inquiries” on your credit report. If you have applied for too many new accounts recently, it could have a negative effect on your score. Every inquiry isn’t counted: for example, inquiries by creditors who are monitoring your account or looking at credit reports to make “prescreened” credit offers are not considered liabilities.
- How many credit accounts do you have and what kinds of accounts are they?Although it is generally considered a plus to have established credit accounts, too many credit card accounts may have a negative effect on your score. In addition, many scoring systems consider the type of credit accounts you have. For example, under some scoring models, loans from finance companies may have a negative effect on your credit score.
Scoring models may be based on more than the information in your credit report. When you are applying for a mortgage loan, for example, the system may consider the amount of your down payment, your total debt, and your income, among other things.
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Here are the last 6 of 10 things you can do to improve your credit score:
- 5. Use credit cards—but manage them responsibly. In general, having credit cards and installment loans that you pay on time will raise your score. Someone who has no credit cards tends to have a lower score than someone who has already proven that he can manage credit cards responsibly. Mid Oregon has low cost credit cards with no cash advance fees and no balance transfer fees.
- 6. Don’t open multiple accounts too quickly, especially if you have a short credit history. This can look risky because you are taking on a lot of possible debt. New accounts will also lower the average age of your existing accounts which is something that your credit score also considers.
- 7. Don’t close an account to remove it from your record. A closed account will still show up on your credit report. In fact, closing accounts can sometimes hurt your score unless you also pay down your debt at the same time.8. Shop for a loan within a focused period of time. Credit scores distinguish between a search for a single loan and a search for many new credit lines, based in part on the length of time over which recent requests for credit occur.
9. Don’t open new credit card accounts you don’t need. This approach could backfire and actually lower your score.
10. Contact your creditors or see a legitimate credit counselor if you’re having financial difficulties. This won’t improve your score immediately, but the sooner you begin managing your credit well and making timely payments, the sooner your score will get better.These ideas won’t create a dramatic improvement in your credit score overnight, but over time, they will. Remember, it takes time to develop a strong profile. Once you’ve done it, you’ll find it easier to apply for credit and favorable interest rates.Talk to us to find potential tips and solutions. We are only a short trip (visit one of our 7 Central Oregon branches), a quick email or a short phone call away.((541) 382-1795).