Online Payday Loans Can Be A Real Lifesaver When Financial Emergencies Strike
Whether it's an unforeseen bill, emergency travel costs, or home repairs - an unexpected negative change in your overall financial situation can be incredibly stressful. The utilities need to stay on, the bills need to be paid, and you need to put food on the table.
So how do you cope with such a financial crisis?
One of the easiest, short term solutions to an emergency financial problem is an online payday loan from a licensed lender. Taking advantage of these loans can help you cover emergency or necessary expenses and overcome temporary financial hardship.
Payday loans (also called short term, pay advance or cash advance loans) are often dismissed as not worth considering because of being too risky or the feeling that they are illegitimate, but there are many reputable lenders out there and they can be a real lifesaver when you find yourself faced with an emergency. Payday lending is legal and regulated in most US states, so as long as you do your research there's no reason why you shouldn't consider one of these short term loans. But what does a short term loan entail?
As the name suggests, a payday loan is a loan that helps to tie you over until your next pay day, a bit like an advance on your wages but without bothering the boss. They are designed to give you quick cash when you need it, but are expected to be repaid on or just after the date of your next pay check (usually no longer than 2 weeks). As long as you can genuinely cover the loan when your wages are paid, they can be the perfect solution to those temporary financial hiccups.
Of course there are many options out there if you need credit; a personal loan from the bank, a credit card, borrowing from friends and family.
But not everybody has those options. What do you do if your credit card is already maxed out or the bank rejects your application? Borrowing from friends and family is not always a good idea either. This is when payday loans begin to shine. Not only is bad credit not always a problem, but the speed at which the process can be completed is much faster than borrowing from a bank or applying for a new credit card. Many payday lenders can get you the cash be the next morning.
But who is eligible?
As with all forms of borrowing, you must be a legal citizen of the United States who is 18 or older, residing in one of the many states that permits payday lending. The process is easily completed online and can be done so in a matter of minutes if you have everything prepared.
You'll simply be asked to complete a form with your personal details, how much you wish to borrow and your income status. You may be required to provide documents to verify this, but if you have scanned or online copies you can forward, there may be no faxing involved.
Lenders will then run some backend calculations and can typically make you an offer within 5 minutes, as close to instant approval as possible. Steer clear of any company promising otherwise, as they are likely being misleading. Likewise any lender or service that promises no credit check is likely also not being honest. All reputable lenders will pull some kind of credit history even if it isn't from the big three bureaus.
What separates cash advances from bank loans is that bad credit isn't always the deciding factor.
Your income is considered far more important and usually has to be at least $1,000 per month. Borrowers with bad credit are approved all the time, which makes payday loans perfect for those who have no other options.
Of course just because lenders are willing to offer you money so easily doesn't mean it isn't an important financial commitment. As with any from of credit, if you are using it to cover long term debts you are only going to end up with further problems.
Repayment is typically taken from your bank account automatically 2 weeks after the loan is issued.
You will also have to pay a finance charge. This is the only fee unless you fail to make the repayment. Doing so will also have a negative impact on your credit rating, making it harder to borrow in the future.
With that in mind, if you have a genuine financial problem that can be covered by your next pay check, a payday loan can be a real life saver.