Almost every person at some time or another will have to take some time to step back and look at their financial situation. They might be forced to look at their economic circumstances because there has recently been something that made them need some fast money to get them out of a tight spot. These situations range from trying to avoid an overdraft fee on a checking account to figuring out how to pay for an unexpected medical bill.
These sorts of problems happen to almost everyone. It would be nice if everyone always had enough to fulfill their needs and even a lot of their wants.
Unfortunately, that is not how our society works. There are just some times when a lot of people struggle to get everything life requires.
So what is there to do when you need money fast? A payday loan, or sometimes called a cash advance, has become one of the most legitimate and successful ways to get cash quickly. Although payday loans have been given a bad reputation, when used wisely, they can be a financial life saver.
A payday advance is a short-term loan which usually lasts about two weeks. It is paid back by writing a post-dated check or agreeing to a future electronic withdrawal to be taken out of the borrower's bank account on their next payday.
There can be some disadvantages to cash advances if not used correctly. For the most part, however, payday loans can be a very good way to get your financial life back on track.
Payday advances are usually extremely easy to apply for. There is usually a short application form that asks where you work, your home address, telephone number, and your monthly income.
You will also need to provide information about your bank account. The application will usually ask for the name of your bank and your account number. Don't be worried about giving out this information as long as the payday lender has a good and known reputation.
When you apply for a cash advance, you will also be asked to provide a recent paystub from your employment, your latest bank statement, and a copy of your driver's license. With payday loans, there should never be a credit check, which means you don't have to have good credit to be approved.
You should also never have to provide any collateral to get the loan. In all, the application process should only take about half an hour and you will have your loan shortly after. A payday advance should be very quick and simple.
Of course, when you are getting any type of loan, there will be things you need to watch out for in order to not have to pay more money than you need to. Before you apply for a payday loan, make sure you will be able to pay back the loan in its entirety, including the fee the lender will charge you.
A cash advance will have a higher annual percentage rate, or APR, than most loans only because the loan is only out for about two weeks. However, the APR shouldn't be much higher than 400%. To put it in perspective, a two-week loan for $100 at 391% APR will yield a $15 charge, bringing the total amount to be paid to $115.
Be careful to be able to pay off your loan as soon as you can. If you absolutely can't pay it off, you will be able to roll over your loan to extend it for another two weeks.
In this example, another fee of $15 would be added to the total. Usually, a payday loan can be rolled over three times. It would be incredibly wise to not do that, however. If the loan in the example was rolled over three times, the original $100 borrowed would cost $160 to pay off.
Payday loans are meant to help people out. Although people can use the money for whatever they want, it would be smart to use a payday advance only in the case of an emergency.
Before getting a cash advance, make sure you know all of the details. Make sure you don't borrow more than you can pay off.
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