On Line Payday Loan: A Solution

An on line payday loan has increasingly become popular in recent years as a quick fix; a fast cash alternative to a bank loan. In simpler terms, it is a cash advance, or a short-term loan, with fewer restrictions involved.

It is convenient for someone in desperate need of a few hundred bucks to pay for an immediate or unexpected expense, like car repairs, house repairs, or hospital bills. However, is an on line payday loan the perfect solution to your financial woes?

Basic terms of on line payday loan

Most payday loans work on the same terms. Whatever amount you loan, you are bound to pay for it in full, including the fees (interest) on your next payday. For example, you may for a loan of $500, and your loan company requires a $10 fee for every $100. On your next payday, you must pay $500 plus the $50 fee, giving you a grand total of $550. There should be no problem if you have that amount by the time you get your next work pay. However, if you come up short and cannot pay for the amount in full, you can do a “rollover”, which means that you move your loan payment to your next payday. When doing this, you will still have to pay accumulated fees.

Qualifications for loan approval

Unlike a bank loan, companies offering payday loans require very few qualifications for loan approval. These basic minimal qualifications are:

The applicant for a payday loan must be at least 18 years old
The applicant must have a verifiable source of stable income
The applicant must have an active personal bank account in his or her name

These minimal qualifications make it a convenient and easy online payday loan for anyone wanting to apply.

The application process

There are hundreds of companies offering payday loans online. You just have to browse them and take your pick. The application process usually involves filling out and submitting the application form provided online. This includes providing your personal information including your bank account number, so that the company can electronically wire the money straight into your bank account. All you have to do next is to wait for your application to be processed and approved. This usually takes an hour to a few hours or one day.

Advantages of getting an on line payday loan

For someone who is desperate and needs quick cash, there are more immediate advantages than disadvantages.

If you meet the minimal requirements above, you are ready.
Most payday loan companies do not require an inquiry into your previous credit and financial records. This makes a payday loan more attractive and accessible even to those with unreliable and bad credit record. It is safe to say that there is no discrimination for companies that provide payday loans.
You can apply for an online payday loan in the comfort of your own home or office. There is no need to go out and apply to a loan outlet.
The application process is easy and can be completed within 30 minutes or less.
You can apply for an online payday loan even on a holiday or after regular working hours.
Your payday loan will be deposited straight into your bank account after your application is confirmed. You only have to go to your bank to withdraw your loan.
Online payday loans are extendable, which means that if you cannot pay for on time, you can move the payment on your next payday.
Most on line payday loan companies have a privacy policy. The information you provide will be secure and treated with confidentiality. Nobody else will know you applied for a loan.

Disadvantages and risks

With the advantages, there are also the disadvantages. The major issue is that an on line payday loan is very expensive. The U.S. Federal Trade Commission has even gone so far as declaring that payday loans are “costly cash”. Even if you can roll over your loan, you will only end up paying abnormally high interest rates along with your principal loan amount.

For example, if you borrow $100 with a service fee of $15, after 14 days, or on your next payday, you will have to pay $115. If you roll over the loan for another payday, your total will be $130. If you roll it over for 2 more paydays, you will have a staggering total of $160.

In a time of weak economy and financial crisis, you simply cannot afford to take such an expensive risk. Also, since companies offering payday loans fast approval are scattered all over the Internet, there is the danger that some of them are illegitimate or even scams. You can never be entirely sure who it is you are giving all your personal information to, and if it will remain confidential and used purely for legitimate business transactions.

Final verdict

Now that you understand what an on line payday loan entails, you can decide whether or not it is the answer to your financial problems. If you have a pressing financial concern, and do not have any other feasible alternative, an on line payday loan can be your last resort. If you use this, remember that you should only borrow an amount that you can cover on your next payday. It is not advisable to do many rollovers for an amount that your income cannot pay.

An on line payday loan can be a quick fix to a pressing money problem only if you can afford to pay for it and the service fee included on your next payday. It is not an advisable alternative if you cannot pay back the loan immediately because it will only cause you bigger financial woes in the long run.

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