Payday Loans or cash advances are small and short-term loans starting from $100 to $1000 based on the current earnings of an individual. The amount that can be approved also depends on the individual’s state or province in whch they reside. They provide the necessary support required to take care of emergency situations. One may have to take care of sudden unexpected payments such as house repairs, car repairs, utility bills, health care expenses, school supplies or any other unexpected expenses.
Payday loans are aimed to take care of a cash flow problem that arises before payday. They are also known as payday advances as your loan is supposed to be paid back by your next payday. The maximum time allowed for repayment of a Payday Loan is up to 30 days.
Prerequisites for applying for a payday loan:
- It is compulsory that the age of the applicant be above 18 years
- A definite source of income
- Social Security Number.
- Driver’s license
- Checking account
- Bank’s routing number
The advantages of a Payday Loan
There are many Payday Loan Companies available in the market. You can find a loan provider in your local area. There are many companies that offer their services online and over the phone as well. You can approach any company that you find reliable. They would ask you for the above mentioned details. Once you have submitted the details the information provided will be verified and the loan will be approved.
The payback period is usually 30 days. You are supposed to pay back the loan once you receive your next salary. At the time of receipt of your payday loan you are supposed to write a check in the amount of the loan plus the payday fee in the name of the payday loan provider.
In case you receive funds before your payday you can contact your lender before the date on the check and pay back the loan, or you can let the lender withdraw the amount that is pre-decided on the check.
In case the cash flow situation prevails for a long duration you can request your lender to extend the loan by paying him the payday fee and writing him a new cheque for the loan amount.
Payday loans come as a blessing in disguise and provide financial help in time of need. They are relatively easy to get and cheap compared to other types of loans available in the market.