Payday loans are designed in order to cater to short-term finance needs. Did you know this fact? It is a way to come out of trouble but for a short-term. If you think it as a long-term option you are doomed. They are a quick option when faced with surmounting financial pressure, in order to buy time for making alternative arrangements. You can say they are stop-gap arrangements.
The interest rate of payday loans is not less. Only opt for payday loans when no other options are there. While taking the loan eventually you should be aware of their basics.
- Loan Term Knowledge – Payday loans have very short-term. Only a few weeks at best a month credit will not pinch you. The advantage is that you will get instant cash credited to your checking account. However be careful of the high interest rate.
- Interest rate – There is no point calculating the annual rate. If you calculate what you are paying monthly well it is 6 percent minimum. When calculated for a year it is at least 300%.
- Delay in Payment can be deadly– Not paying for a long time will definitely cost you. You might have to pay 3 to 4 times the principal. So be aware of this fact
So if you are looking for short-term option payday loans can be great. But for long-term it is a big No!
Now you do not have to visit the office to get a payday loan. It is a loan service which is designed to help people who need instant cash. The payday loans are different from the normal short-term loans. You can get the money quickly without going through the long process of loan disbursal.Life is full of situations which cannot be predicted. These include medical emergency, accidents etc. You might sometimes not have enough money to pay during these unexpected emergencies. There are many service providers that help you overcome these emergency situations.
What is required by direct payday lenders?
The direct payday lenders have some minimum requirements for you to get this facility. They are:
- Age 18 Years – You are eligible for the loan only when you are 18 years old. This is done so that the loans are provided to mature people who will not default.
- Source of income – The payday lenders provide loan to people having a steady income. The source of income and the amount on your paycheck decides the amount of disbursal.
- Citizenship – The lending company will disburse only to citizens of the country where they are operating. This is to protect against default as the loan has no security against it.
- Bank Account – Always the loan is linked to the bank account provided by the borrower. This will help to protect the lender against default and also keep the borrower identified.
In the technological age you can get the money in your account in a matter of hours. Always choose the direct payday lenders and do not get involved with the brokers. The direct payday lenders are governed by legislation which will protect against the heckling by brokers. Also getting loans directly you will get more money in your hand as you skip the broker fees. The direct lenders will review you eligibility and then contact you with their terms and conditions. Read the terms and conditions carefully before signing up. It is the matter of your money. Always be prudent while going through the interest payment part of agreement and try to get a loan with minimum cost.
Be a responsible Borrower
The loan is a debt and should be treated accordingly. Be reasonable and take only as much you can pay easily without much strain. The short-term loan comes with some terms and you should abide by these to stay away from credit troubles. If you are planning to take some long-term loans make it sure that you pay these short-term loans on time. This will affect your eligibility for the long-term loans.