Online payday advance loans are easy to request short-term loans which are usually taken for 2 to 4 weeks or until the next paycheck. These online loans can be obtained within a business day or the next day at most and require no collateral and thus are also called unsecured personal loans.
Payday loans have several different names such as: payday advance, cash advance, payday loans, same-day loans, short-term personal loans and so on. Basically all of these terms refer to the same type of loans.
No matter, what kind of emergencies you are up with, these loans will help to address your immediate financial needs. Payday loans provide immediate access to funds when you need it the most.
Please keep in mind that payday loans are banned in several US states, while in others the maximum interest rate is limited by the law.
How Expensive are Payday Loans?
These loans come with high fees and it will be deducted from your loan amount. Rather than getting a loan amount lower than your requirement, you can write your required loan amount and as well as the financial charges on the check.
Another thing is that these loans come with high-interest rates and short repayment period, so make sure whether you can make repayments on time. Otherwise, you must pay the penalty for late or missed payments.
What About “No Credit Check”?
You might wonder are these no credit check payday loans? In some sense one might say so, since no traditional credit check is being done. However, most direct payday lenders do perform some sort of background check or softer credit check to understand whether the borrower can afford a cash advance loan. According to US laws, no lender can issue payday advance loans with no credit check at all.
What Can I Use a Payday Advance For?
These instant approval loans are designed for borrowers who require instant cash to meet their emergency financial expenses. Nobody will control how you use the money, but it is always better to use them with caution due to high interest rate and fees. Paying current debt or another loan with a payday loan will surely lead to even more debt.
Cash advance loans have to be repaid within a short span of time. Failing to make repayments or falling on behind on payments can damage your credit score. Make sure to request the loans only during emergencies rather than for unwanted expenses.
When Do I Have to Repay My Payday Loan?
You need to repay these loans with no hard credit check at your next pay date or within 4 weeks. If you cannot repay the loan amount in full and on time, you can request your lender to extend your loan repayment period. It would be better to explain to your lender how much you can repay every month and request him to frame the repayment period accordingly.
This would be helpful to not miss or delay the payments in the future. If you cannot repay your loan amount even inside the extended period, your credit score will be damaged.
What If I Can’t Repay My Payday Loan?
Failing to pay out the loan on time can increase the amount that you will have to pay in fees and fines, that it will be bigger than the initial borrowed amount. Don’t be mistaken that a small cash loan of $250 is an easy deal.
If you have a legal obligation to pay out the debt, then, depending on your state of residence, some lenders can turn directly to the bank to get the money from your account. Also constant collection calls is a part of lender’s strategy when you fail to repay the loan. Another thing which is worth to consider, that your credit score will be surely damaged
Before Taking Out a Payday Loan
Loan Regulations
The rules and regulations of the loans vary for every state. You need to understand the rules and regulations of these payday advance loans before requesting the loans. These loans are processed fast and ensure funds transfer on either the same day or the next business day. Usually they have 30 days term-limit for repayment. Your state regulations and lender decide the amount you can borrow.
However, you must make sure to borrow the amount you can repay or require to solve your emergency situation. If you tend to borrow more, it would be difficult to repay the loan amount.
Financial Standings
These cash advance loans are solely designed for borrowers who cannot qualify for the traditional bank loans or with lower income. Usually, lenders won’t consider borrowers’ income limits and credit scores to process or approve their loan request.
However, to be on the safer side, borrowers must check their financial position before taking these loans to ensure they can repay it on time and in full. You can also repay the loan amount in installments, but repaying the loan amount in a lump sum can raise your credit score.