What a Payday Loan is Really All About
A payday loan is an unsecured loan not dependent on collateral such as a car. They are short term loans meant to be paid back in a few days usually on your next payday. You can apply online and the money loaned can be credited into your bank account on the same day.
Generally when you make your first application you can borrow $300 depending on your take home pay. You are more likely to be approved the less you want to borrow so it is advisable to borrow only what you need. Like other lenders once you have established yourself you can borrow a higher amount if needed the next time.
Requirements for Payday Loans
To be eligible for a payday loan you must be over 18 and employed for at least three months. You must also have a bank account with a valid debit card. Even if you have bad credit history you should still be able to obtain a payday loan if you fulfill the above criteria.
How do You Repay the Loan?
You will need to repay the loan amount plus interest on the date specified in the loan agreement. Your next payday is usually the agreed upon date which is where the term payday loan comes from. The repayment may be collected by debiting your bank account on your next payday.
Loan Extension Requests
If something comes up and you are unable to repay the loan on time you can ask for an extension. If this happens it is recommended you contact the lender and explain your circumstances so they can explain your options.
What are the Benefits of a Payday Loan?
Eligibility: One of the benefits is the speed at which the cash can be credited to you. The money you need can be available to you in your bank account the same day you apply. This can be very helpful if you have a short-term cash flow problem and need money right now.
The application process is very simple it takes a few minutes to apply and you do not have to waste time posting or faxing documents to the lender as you would with a bank loan for instance.
Poor Credit History: Payday loans are available to people with poor credit. This is because payday loan companies do not make their decision to lend solely based on credit history. As long as you meet their needs they can give you what you want.
The reason payday loan businesses seem to be everywhere is because they can meet the needs of people who do not meet the criteria of the banks plus banks will not lend small amounts for any reason.
To Wrap This Up
There are a lot of good people who do not have a credit card or established credit so they use payday loan companies to help get them through a tough time.
All in all getting a short-term loan is easy and convenient giving you access to money when you need it without the hassle of getting rejected at the bank.