Payday lenders usually charge interest of $15-$20 for every $100 borrowed. Calculated on an annual percentage rate basis (APR) – the same as is used for credit cards, mortgages, auto loans, etc. – that APR ranges from 391% to more than 521% for payday loans.
Which is the cheapest way to borrow money?
Cheapest ways to borrow money
- Personal loan from a bank or credit union. Traditional financial institutions like banks or credit unions tend to offer the lowest annual percentage rates, or total cost of borrowing, for personal loans.
- 0% APR credit card.
- 401(k) loan.
- Personal line of credit.