All you need to know about payday loans and direct lenders as a source of short-term loans
In our fast-paced life today, being prepared for each of life’s challenges is almost impossible. We may strive to cover ourselves with many different insurance covers, but then comes that time, you are in need of a quick bailout. Or in the middle of the month, your pay runs out. In such instances, a payday loan may come in handy.
In simple terms, a payday loan refers to a loan provided by non-banking institutions at a slightly higher rate and paid upon receipt of your next pay.
Why Payday Loans
As stated, they are quite easy to access with many loan companies in this market.
They have a very simple application process. Simply provide your provider with your personal information such as identification, bank details, and any other relevant information and once they run your credit check and you are approved, it takes roughly one business day to check funds into your account. It is important to understand the loan terms before taking the loan.
Keep in mind payday loans from direct lenders only provide a cash advance as a reprieve to overcome a difficult period until the next pay comes in. These companies make their margins through the high interest charged.
Most payday loans direct lenders provide the option for installment loans.
For security, most lenders accept post-dated checks, but at a significantly high rate. With this option, it is very easy to get dependable on these loans, so tread carefully.
How it works
Payday loans work best not as a long-term financial solution. They are to bail you out ‘for now’. Make sure your provider of choice is credible and has a reliable customer support team.
Depending on loan amount and your ability to pay, you are bound to find a provider who will best suit your needs. Most provide a short-term loan of up to $1000, but some lenders can lend up to $2000 for short-term loans. Find a lender whom you are comfortable with in terms of the payment period, loan process time, interest rate and the installment amount in case of installment loans.
With most of these companies, the online application process is mostly similar. They provide a step-by-step form on their websites that are simple to understand and fill out. On each site, you will find the terms of the loan and their expectations of you as a borrower. Be keen on the details.
Upon request, the lenders are at liberty to deny your request if you do not seem fit to repay based on the information collected. Bad credit, for instance, sets a bad precedence for you as a borrower. Most lenders will not take the risk to fund as you seem unfit to repay.
Before choosing to take a loan cash advance it is important to know your rights as a consumer, this information is readily available on the Federal Truth In Lending Act. Additionally, take advantage of the Better Business Bureau to check if your lender has had any complaints filed for prejudicial practices. Cover your basics, ignorance is no defense.
Don’t let the ease of it blind you to its disadvantages. Most loans, such as online payday loans are accessible at a click of a button making it very enticing to pass up. This may lead you to incur debts you do not necessarily need and at a remarkably high price.
In addition, falling victim to multiple party lenders is not unheard of. The huge fees have kept many borrowers in debt as a month-to-month pay does not necessarily meet all obligations and leave room for monthly installments. As eye catching as they are, they are still debt, a temporary fix. Getting reliant on them leaves you with little freedom while the goal is to be financially secure.
If the financial need is not an absolute emergency, best save for it. That vacation, party or outfit does not have to cost more than it should.
Using payday loans wisely provide the avenue to handle rather tough situations and scenarios with ease and minimal stress. Do your homework, take on what you can handle without adding undue pressure and strain on yourself. If a few lifestyle changes can leave you with more disposable income, that is a better way to go.
Now that you know, go ahead and fund that project. Fill out our loan application form today and get connected to reputable lenders.