Payday loan: A Complete Overview
From different surveys, it is seen that the number of customers taking payday loan as well as payday lending companies are increasing frequently. If you are a person taking the payday loan for the first time or want to gather information regarding payday loan, then this article will be of great help to you.
Definition of payday loan
Payday loan is a very short term loan. Usually the term is
1-2 weeks. There are other names of payday loan like - Cash Advance ,
Paycheck loan , Check loans , and Payroll advance loans .
After you get your paycheck, the loan is to be repaid. If you can not repay the loan amount plus lender's charges for payday loan on your payday, you can rollover the loan amount by paying extra fees to the lender plus you have to pay the interest along with for the rollover period. So, payday loan can be termed Loan Sharking .
Necessity of payday loan
By the end of the month, you may face some problems in maintaining some
urgent family expenses like paying off your Medical Bills, Phone Bills, and
Electric Bills, House Rent or some other utility bills. These things
usually happen when you fail to maintain a proper budget at the time of
getting your paychecks or not keeping your expenses up to your income
limit. Hence in order to meet such urgent expenses you need a payday
loan.
Payday loan companies
There are many companies who are
promoting check cashing facilities online. Also, some banks and other
financial institutions provides you with a payday loan.
Conditions to be satisfied to get an instant payday loan
The requirements of different payday loan companies are
- You must have a job or there should be a regular source of income
- You should have a checking account in a bank
- You should be an US citizen
- You should be at least 18 years of age
- Your monthly income should be at least $1000 Per Month
Best application time of payday loan
If you apply for the loan from Monday to Thursday,
you will get the loan on the next working day, i.e. Tuesday to Friday. If
you apply for the loan on Friday, then you will get the loan on the
next Monday, and if you apply on Saturday or Sunday, you will get the loan
on Tuesday. So the best time to apply for the loan is Monday to
Thursday.
When will you get the money?
As the process is very simple to get
the loan amount, in general you will get your loan amount within 24
hours of application. Company will check your documents and verify your
data with an automated system named as VPN Based software, and then
approve your loan. The entire process of verification of your identity and
depositing the money to your checking account takes 24 hours of time. There
are some companies who will deposit the loan amount in less than 24
hours.
Costs of payday loan
Usually a payday loan company charges 15
to 30 USD per $100 borrowed. So, if you borrow $100, you will have to
pay 115 to 130 USD on the very next payday. The APR of payday loan cash
advance interest boosts up to 391%.
Maximum limit of payday loan
If you are taking a payday loan for the first time, you may get up to $500
for the first time. After you repay back your first loan amount in
time, you can apply for more than $500 when you revisit the company for another
payday loan.
Think before taking a payday loan
- You should keep in mind the APR factor of the loan before taking it. You should find the company which is charging a lower APR than its competitors
- You should take care about the privacy of your document and information. So, if the tendency of the company is to process applicant s information in an encrypted page, you should think that your information will not be licked out, and then you can proceed on
- You should read the company policy and legal matters complied with before submitting an application form to them
Repayment of payday loan
The lender company will take the money off from your checking account on the date of your payday. You
should be ready and aware about your payday and the amount to be
repaid. If you fail to repay the loan on the scheduled date then you may have
to ask the lender to rollover your loan amount.
Alternatives to payday loan
- In order to avoid taking such high interest loan like payday loan cash advance, you should make an appropriate budget which is according to your income
- You may also save certain amount of money from your paycheck every time you get it
- Before taking a payday loan cash advance, you should be looking for a loan from a friend or relative as they will not take any interest for lending the money to you. Another thing is also involved here that if you not be able to repay the money in future, you may not have to run away from your creditors
For more information regarding alternatives to payday loan, visit http://www.ampmcash.com/loan-alternative.html
For more information regarding applying for a payday loan, please visit http://www.ampmcash.com/quick-approval.htmlAbout the author Angelina Rosario is an Author of http://www.ampmcash.com/ and she is currently working with http://www.ampmcash.com/faq/ To contact her, mail to:angelina@ampmcash.com