We'll start with the
most common question of all when it comes to payday advances.
1. What is a payday
advance?
A payday advance is
simply that. A loan you receive and pay back by your next payday. There
obviously is more to it than that so let's move on.
2. Why is this
different than a bank loan?
Bank loans require a
good deal of paperwork, questions into your personal finances and then days for
approval. Payday loans have little, or no paperwork upon application.
There are online lenders
that tout they are faxless loans. There are not questions regarding how much
you make per month, what your expenses are or any other personal information
that you may or may not be inclined to disclose. Your approval is usually done
in minutes.
This is possible
because payday loans have different lending laws than do banks. And payday
lending institutions have limits on how much they can lend you. For instance,
most loans don't go higher than a couple thousand dollars.
3. What are the
interest rates for payday loans?
Interest rates are
fairly comparable to banks. They may be a bit higher because of the convenience
you are buying into just to get the loan. Although, I need to point out that
the interest rates when compared to banks APR's, the numbers may be staggering.
And a lot of time, that is where peoples attention stops and they forget to
learn why.
As was mentioned
earlier, payday fast cash loans are SHORT TERM loans. They were not designed to
be long term and any lender that encourages you to get one long term, may be
scamming you. If not, then look at their interest rates to be sure you are
getting a better deal that won't cost you more money than your loan in the
future.
Short term interest
rates are carried into any time that you default. Meaning, the longer you take
to pay back the loan, the longer you are paying those high short term interest
rates and then it is not very long before your original loan is much larger
than when you received it.
4. What is the
application process? What do I need to attain a payday loan?
The application
process is so simple you may just laugh. Obviously they need your personal and
contact information. They will require so many paycheck stubs to prove you have
consistent work to pay the loan back on your next payday. And then finally, a
post-dated check from you to be cashed on the day you have been paid and pay
the loan back in full.
If you want a direct
deposit, which has become so popular these days, you will need proof of a bank
account. That is it. You can work it out with your specific lender how you pay
it back. You can set up that time for your next payday. There are people who
write their post-dated check for half the amount and then another for the date
of their next check. Those details can be worked out with your lender.
5. What if I have bad
credit?
Even if you were just
turned down for a loan at a bank, you could still walk into a payday lending
office and be approved for a loan. If you have all the requirements we just
talked about; pay stubs, address, SSN, etc, then you are in the clear.
No comments:
Post a Comment