Payday loans are distinguished from other lending instruments because of their brevity, typically a month or two or until the borrower’s next payroll. The sheer number of online payday loan companies as well as those operating physical storefronts make it possible for low to middle income families to easily get loans which banks and other lending establishments won’t provide to them. These days, the increasing availability of no fax payday loans online, makes it possible to get emergency cash quickly and easily.
There are many reasons why people prefer borrowing from conventional and online payday loan companies instead of banks. It being an unsecured loan (not requiring lien) is one of them. The elimination of redundant processes effectively makes application turnabouts faster, in most cases, approvals are made in just a matter of hours, minutes even. When problems like unpaid utility bills or car breakdown suddenly crop up, having access to same day payday loans can be a real life saver. Requirements are also more relaxed, no fax payday loans online for example allows people with poor credit history a fast and easy access to needed cash.
While proprietary requirements vary, only those who are employed who are 18 years old or older and have active bank accounts can apply for these loans. After filling out a request form, lenders may ask for some documents, like payslips. Walk-in applicants may need to provide a post-dated check to which the loan will be secured against.
For online payday loan companies, loan repayment and other predetermined fees will be electronically withdrawn from the borrower’s bank account come next payday. When an application is approved, the money will be deposited directly to the borrower’s bank account. Borrowing from online payday loan companies is definitely more convenient because you can apply from the comfort of your own home or office. While you can send an application anytime of the day, the lender can only make a deposit during banking hours.
One oft-mentioned criticism of payday loans is the high interest rate. You must remember though that these loans are unsecured or requiring no collateral, and have less stringent requirements as well. The higher interest is simply a way of protecting the lender from the inherently high risk of default from these transactions. Typically lenders charge $10-15 for every hundred borrowed. Sensible borrowing and adhering to repayment schedules will preclude you from being in a debt trap, which more often than not, is self-inflicted.