Payday Loans 101: Answering Some of the Basic Questions!

Payday Loans 101: Answering Some of the Basic Questions!

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Dealing with an unexpected expenditure? Need money to stay afloat until your next pay day? Instead of asking around or borrowing from someone, you can consider applying for a payday loan. With websites like Small-bizsense.com, getting a payday loan is as easy as you can imagine. In this post, we are answering some of the common & basic questions about payday loans.

  • “How quickly can I get a payday loan? How much can I borrow?”

The entire process of applying for a payday loan doesn’t take more than a few minutes and can be done online. This means no one needs to know that you are facing a financial crunch. If your application is approved, you can expect the money in your bank account within the next business day. How much you can borrow depends on several factors, but if you are in states, such as Texas or California, you can borrow as much as $1,000.

  • What’s’ the term of a payday loan? What are the requirements?

A payday loan is due on the next pay date. Your next pay date should be 8 days away or more, but not more than 31 days away. The requirements are pretty basic. Most payday loan lenders don’t do a credit check, because the loan is secured against your income. You don’t need a collateral either. However, you must be a citizen of the US, should have an active bank account for receiving money and repaying the payday loan, and should have a stable income. Some lenders may have other requirements, which can be checked online.

  • Are payday loans expensive?

Any form of unsecured cash advance is expensive. That’s because the lender is taking a risk by giving the loan without a security asset, or a credit check. Typically, the APR of payday loans is higher, as with installment loans, and there can be processing fee involved. Make sure that you are aware of the cost of taking the loan before you apply. Read all terms and conditions in detail, and ensure that there is no room for hidden charges. Many online portals, such as Market Business News, have considerable information on payday loans, which can be handy for new applicants.

  • What are payday loans used for?

It depends on your need. At the basic level, the purpose of a payday loans is to keep you afloat until the next pay day. This is a short-term loan, best used to handle unexpected financial circumstances. If you have unpaid bills, or need to pay for a repair expense out of the blue, payday loans can be useful. Do NOT use payday loans as a means to cover up for unnecessary spending, or to consolidate debts.

If you need more than $1,000, you can consider installment loans instead of payday loans. Just read the lending terms in advance, and retain the intention of repaying back in time. Used for the right reasons, payday loan can be a great way to beat financial distress.

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