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Pay Advances: Understanding How Payday Cash Advance Loans Work

Pay Advances
Pay Advances

Payday loan lenders or cash advance companies are well known for providing assistance to individuals who are in need of a short term cash solution. Pay advances, also referred to as payday loans or cash advance loans, are now increasing in popularity mainly because of the convenience that it provides to borrowers. Most payday loan or cash advance lenders offer their services through their own websites, so that loaners are provided with an easier way to apply for a loan. While pay advances are ideal for people experiencing short term cash problems, this is not recommended for a longer term use.

Pay Advances: What does Pay Advance Loan Mean?

We all know how hard it is to budget our income, especially in these troubled days. Sometimes, things that are out of your control such as emergencies happen, and because you do not have enough savings, you do not have any means to pay for the expenses associated with these emergencies. Since you have already used the money from your income to pay for your monthly utility bills such as electricity and water bills, groceries, rent, house maintenance or car repairs, you are now faced with the problem of not knowing where to get the money to pay for emergency expenses. When this happens, you can turn to the payday loan lenders for help.

Pay advances or cash advance loans, simply means that you will be taking out a loan that is supposed to be repaid by the time that you get your next paycheck. Payday advances are short term loans that borrowers can take out to pay for daily expenses. You can use this to pay for emergency expenses, to pay for your utility bills, for your rent, or for your house and car repairs. Payday loans are commonly used by individuals to pay for these bills that they are required to pay before they get their next pay check to avoid paying for any unnecessary surcharges or late fees.

Things to Consider before Taking out Pay Advances or Payday Loans

As with all types of loans, there are several things that need to be considered before taking out pay advances or cash advance loans. While most payday loan lenders or cash advance lenders offer instant approval or guaranteed approval, it is important that you reach a full understanding of the terms and regulations of these loans. Understanding how pay advances work will help you avoid misusing or overusing it. Misuse of payday loans or cash advance loans may result in you drowning in huge pile of debts that will only cause you more trouble in the future. Some of the things that you should consider include the annual percentage rate, the maximum loan amount and the repayment terms.

Repayment Fees or Annual Percentage Rates of Pay Advances

The repayment fees that are associated with pay advances are also known as the annual percentage rates. These are the fees that payday loan lenders charge to their customers in exchange for the loan that they will be taking out. While most of the payday loan lenders or pay advance lenders charge a fixed amount of annual percentage rate for smaller amounts of loans, there are some other companies that may charge you with higher repayment fees. In order to avoid this, you should understand all the terms and regulations of the pay advance loan that you will be borrowing. Most loan lending companies include this important information in the documents that they issue to the borrower.

Maximum Allowable Loan Amount with Pay Advances

Briefcase With Cash
Briefcase With Cash

Since there are now numerous payday loan lenders, you can expect that these companies offer their services with different maximum allowable loan amounts. If you only need to borrow a small amount of money from payday loan lenders, you can go for the pay advances type of loan. Some loan lending companies offer higher loan amounts with their payday loans; however, this is usually reserved for existing customers only. In the event that the maximum allowable loan amount is not sufficient for you financial needs, you might be better off taking out a personal loan instead. Taking out a personal loan will prove to be a lot cheaper compared to taking out several cash advance loans.

Repayment Terms of Pay Advances or Cash Advance Loans

The terms and conditions of pay advances vary based on the requirements set by the loan lending company. Because they set different requirements for the loans they offer, it only makes sense that their repayment terms will also vary. However, the repayment terms of cash advance loans generally depend on the length of time that you will borrow the loan money.

It is also important to take note that there are some loan lenders who require the borrower to pay for the loan money on the original specified date while there are some loan lending companies that allow an extension to be made if the borrower will not be able to make a payment on time. The company will then charge a small fee.

The Convenience that Pay Advances Offer

One of the major reasons why a lot of people turn to pay advances for help is because of the convenience that this type of loans provides. Pay advances are specifically designed to provide immediate money resolutions, so most of the loan lenders guarantee instant or quick approval for their loan services. Once the borrower's application has been reviewed and approved, he or she will be able to see the money in his or her bank account within a few hours or within the day.

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