How can I get a payday loan? Most of us think that whenever we desire something unreachable, we need to take a loan to make it possible. When we think of buying a new house or getting a new car, we think of applying for a loan because our savings are miserable.
However, even if we are not aspiring for something that ambitious, we still might fall short of money at certain times of the year. Such events like weddings, celebrations etc require extra money because we all want to gift our near and dear ones. Or there might be sudden expenses like a medical bill, home or car repair, etc.
Borrowing money from friends and relatives does not look good every time. Payday loans are the best way to get monetary help on a short term basis. A payday loan is a great way to take care of your short term requirements. A payday loan is given by the creditor on the condition that the borrower will repay it on the next date of payment. There are many financial institutions and banks that work with payday loans.
Payday loan is given by the creditor on the condition that the borrower will repay it on the next date of payment.
Common Terms and Conditions of Payday Loans:
- As the name is self explanatory, it is evident that payday loans have to be repaid on the next date of salary payment by the borrower. Information regarding employment is hence asked for by the lending companies.
- To start with, an online application has to be made to get the loan. An internet research will point out the best websites and lending companies in your city or state.
- Once you get the first confirmation, be ready to be redirected to the lender’s website where further details regarding your salary, employment, debit and account information etc will be asked for you. Very often submitting one’s credit history is not required.
- The borrower does not have to wait for long to know whether the loan has been sanctioned or not. If not, then he can immediately start looking again for another lender.
- Next comes, the question of repayment. It is highly possible that contrary to what the borrower initially thought, he cannot repay the entire amount in one installment because that might again pose financial woes for him in the next month. In that case, the borrower and lender can negotiate and work out an extension period.
- The borrower might even be allowed to repay the loan over two paydays or more. However, it is always advisable to go through the terms and conditions of the lender’s website before agreeing to take the loan in the first place to avoid any confusion later.
- You would do well to confirm about the provisions of repaying the loan beforehand and not after you have taken the loan. Make sure you have the required income so that you will be able to repay the loan on the next payday.
- You should also be ready to pay the extra interests that will be added with each passing day till you have made the full repayment.
- If the borrower repays the loan on the first payday as arranged, then he stands a better chance of getting another loan in future.
So, with the help of payday loans, one can take care of all the aspects of one’s life, without having to ask anybody for anything. It can definitely make life easier as far as money is concerned.
Things to Consider about Payday Loan Repayment
To get the loan one will need to provide a verification of the income from the employer. This can be in the form of your monthly payment slips, or your bank account details or any other form which your creditor may wish to see. Repaying the loan can be arranged by either the borrower himself goes to the creditor and pays the amount back in person, or the amount is deducted directly from the account after the salary has been deposited on the date of payment.
Payday loan planning
The fact that you have taken a payday loan means that your regular income was insufficient to cover the increased expenses in a particular month or week. Naturally, when the amount is deducted from the salary on the next pay day, chances are that you are again going to fall short of money. This is where the payday loan planning comes in. Between the two paydays, when your salary has been deducted to repay the loan and your next payment, it is mandatory to cut off any unnecessary expenses to balance off that discrepancy. If you do not have any savings, it becomes essential to curb additional expenditures to balance out the shortage.
…people take another payday loan to get rid of an existing loan and build up a vicious loan trap for themselves
A lot of people do not consider payday loan repayment an important procedure, because of the fact that the amount borrowed is usually small. They defer repayment, thinking that they would repay it a month later and it goes on and on till the interests starts piling up. One month, your entire salary is deducted, leaving you penniless. Some people also make an additional mistake of taking another payday loan to get rid of an existing loan and build up a vicious loan trap for themselves. A seemingly small amount of money suddenly turns impossible to be repaid. This is also reflected in your credit history and you might not get another payday loan ever, just when you would need it badly.
Always make a background check
As far as direct lender payday loans are concerned, there are quite a few of them. These lenders mostly lend out money directly to the debtors and no documents are required to get the loan approved. These are one of the easiest loans available in the market today, but they do charge quite a high amount of interest. It is also possible that some companies might often be scams and they lure in debtors with the pretext of providing direct loans. It is not as if payday loans with no credit checks are not available, but these loans are not legal in most states of the USA. Only some of them have legal standing and the rest work privately, often without a license. To solve this problem, it is always advisable to conduct a background check with the company you are thinking of dealing with, to avoid any kind of complications later on.
How to Apply for a Payday Loan
So, just like in any other kind of loan, a bit of careful planning will help you manage a lot with your payday loan amount as well. It would be a great way of taking care of your additional expenses and control everything around you. Applying for any loan, whether the amount is big or small, requires a degree of caution. That is because in this case, we deal with unknown people and all that there is between the two parties is a set of rules and regulations and a mutual trust that both the parties will stick to them. The same can be said about a payday loan. Though a short term loan, meant to be repaid on the next day of payment of the borrower, this involves certain rules as well and there are some things to be kept in mind while applying for them. Here are the most important rules:
- Background check: While applying for a payday loan, you should check the background of the lending company. In case you know any of your acquaintance who has applied for such a loan before and has had a smooth transaction, then you can opt for them. This is because, the online application is generally sent on the basis of internet search and there is no way to know beforehand if the company is a scam or not.
- Security Concerns: The reason why this kind of caution is required is because once you apply for the loan, you would be asked for details like social security number, account information, debit card information, other bank details, salary details and employment verification. You will surely not want that such important personal details should fall into the wrong hands. In case it does, your entire financial set up can be jeopardized with someone else having access to your hard earned money.
- Proper Information: The payday loans are given on the condition that it would be returned on the next payday of the borrower. Unfortunately, there are many of us who extend this period in the hope that they would have to repay the money later. However, a genuine payday loan company will perform a quick verification of the information you provide and if they find any discrepancy, then your loan will not be sanctioned. It would just be a useless waste of time, especially when you need the money urgently.
- Repayment Options: Before you finally sign the papers to accept the loan, review the terms and conditions for the repayment. A payday loan has to be repaid on the next pay day, so if you have any doubt that you would not be able to do so then check before if there are any provisions to apply for an extension. Or if you are aware that the amount you are taking is quite a lump sum and repaying it out of one salary can be a challenge to take you through the next week or month, check if you can repay it over two paydays.
Like with every other important issue, one should exercise a degree of caution while working with any financial institution. Here are three important things to keep in mind before dealing with payday loan companies, especially with payday loans with no credit checks.
- To start with, before you zero in on the payday loan company, you will have to do a background search that whether the company is genuine or not. Like all things, these companies have also developed scams and hence they are just after people’s money. You might be thinking that they would be the one giving you money, then how do you stand to loose anything?
- But the thing is that to get the loan you will have to provide details like account and debit card information and such information in the wrong hands can be fatal for your finance. The worst mistake that you could possibly make is to take out another payday loan to repay the first. This is how one falls into a perpetual loan trap and ruins their credit history.
- There are also interest rates to consider, because even if the rates of interests are low, they can add up to quite a lot if one allows them to accumulate.
Pros and Cons of Payday Loans
To bring the discussion to a proper closure, let us say that payday loans can make life easier in a lot of respect. To start with, it makes you financially secure and you would not have to look forward for anybody’s help. Even if you have borrowed money before, concerned people will not look at you as a responsible individual. Moreover, it gives you a sense of security. Previously, other people came to know when you had no money you went about asking for it, which could have been somewhat embarrassing. Now you can solve your problems yourself.
Payday loan calculator widget can be used to estimate the costs and repayments associated with this type of loan.
On the other hand, one should also be very cautious about not falling into a permanent loan trap. Since payday loans are approved quite easily, the temptation of taking out one loan to mitigate the problems of a previous loan is quite high and this simply starts a downward spiral. Refrain from taking too many loans because eventually it just might start reflecting on the credit history, and block chances of getting bigger loans approved.
Before applying for a payday loan, it is important that one knows about the laws in a particular state. Loan laws differ widely and some states in the US do not even consider payday loans legal. It may seem like an easy way out at first, but it is still advisable to apply caution before taking a splurge.