Many borrowers who are desperate for money rely on payday loans. While this credit offers instant financial relief, applying for it can be one of the worst solutions you can make. However, as long as you find the right lender and use the loan properly, it can still be beneficial, therefore before you get a payday loan, make sure to understand what it really is and how it works.
What Are Payday Loans?
A payday loan is an unsecured loan that can be acquired by almost anyone as long as they have the capacity to pay the loan. It is given on a small amount and is payable on the borrower’s next payday, thus the name. Typically, the debtor has to write a check to the lender for the principal rate and the interest of the loan. However, there are loan providers who will allow you to settle the debt by withdrawing the cash from your bank account.
If you’ve ever borrowed a loan for your home, car, or other big purchase, you know how complicated the loan procedure is. But this is not the case with payday loans.
With a payday advance, you are only required to fill out an application form online and submit minimal documents that would prove your identity and income, such as an identification card, a bank statement, and a paystub. The verification process happens in just a matter of hours and some lenders can transfer the fund to your bank account on the same day.
Beware Of The High Interest
While there’s no doubt about the convenience offered by a payday loan, borrowers have to be careful when borrowing it. Since the loan is unsecured, the interest rate charged to it is higher compared to regular loans. Therefore, it should only be used as a last resort or only when there’s an emergency. Also, be sure to shop around first and look for the lender who offers the lowest interest.
Payday loan is knows as a short-term loan wherein you don’t need to go through a credit check. The loan is commonly due within 14 days or when you receive your next paycheck. They usually have extremely higher rates than other traditional loans and could be one of the options to get a loan for tose who have bad credit history. So how do payday loan default occur?
What Happens When You Can't Pay Back Your Loan?
Payday loan default happens when you missed to pay your loan on its due date and you can either make a payment in person or the lender will draft the outstanding balance from your bank account. If you don’t have enough balance in your bank account and your bank doesn't pay the overdraft, then the lender will keep on trying to deduct the amount for many times. So, everytime your payment is returned for insufficient funds, your bank will charge you an insufficient funds fee which will lead you into deeper debt with your bank at the same time the payday lender won’t stop until he gets your payment. So make sure that when you apply for a payday loan, you have the capacity to repay it sooner.
Default on a payday loan may also affect your credit score. You may think that when you don’t pay back a payday loan it won’t have any effect to your credit report, but you’re wrong. Your payday loan won't be added to your credit report when you first borrowed and your first missed payments weren't on your credit report or for at least 30 days. But, once your debt is reported to the collection agency, that’s the time it will reflect on your credit report. Because of this, defaulting on your payday loan can hurt your credit score even more. So the bottom line, if you have a bad credit score and you need extra cash that you can get instantly then might as well consider some alternatives because payday loans may only put you into deeper debt and also it will be harder for you to get back on track.
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$100 to $25,0000*
- Apply for $50-$1,000
- Fast Payout
- No Fees
- Secure Application
- Available 24/7
- Bad Credit
How DO I Apply?
How Does It Work?
- SIMPLE AND FAST The approval of your loan will be granted in just a few minutes
- SECURE AND GUARANTEE Your details will be safe with us
- NO HIDDEN CHARGE We will never ask for any additional charges
- ONLINE TRANSACTION The transaction will be done online. There’s no need to go to the bank anymore.
Must I Have A Guarantor??
This is the kind of loan wherein you could get the cash help you need the same day upon application. It is the kind of loan preferred by most workers who are in need of cash to pay their bills on time.
How DO I Apply
You simply go tour site, find and fill up the application form and send it over to us. You will surely hear from us again in a matter of minutes. We will not ask for any complicated documents and such. Just make sure that you provide us with your updated details and info.
Must I Have A Guarantor??
Payday loans do not require any guarantor at all. Unlike other loans today that does need a guarantor, with online loans, you could get the cash help you need even without one. However, it is important that you have a job or have other means of income so the lender will be able to get an assurance that you will pay them back on time.
What Happens If I lie on My Application?
The lender will be able to trace your record and once found out about your false info, you will not be able to get the approval you need. If you will not provide accurate and updated details such as contact info and other important details regarding your application, you will get more serious issues in the future especially if you wish to apply for a new loan.
What Happens If I
There will be the increased rate on your present loan rate if you will miss paying the lender back on time. It will affect your credit score and this could result in further issues in the future. Having a bad record would affect your name and this will cause you troubles in applying for future loans.
You don’t have to worry about paying us back. We provide the most flexible repayment method that will surely help you out. Our offered repayment method will help you pay us back on time. You can choose the right plan that will match your financial status and needs. We will not charge you unless you forgot to pay on time. But you can always get in touch without lenders so you can arrange the repayment plan that will work best for you.