Payday loans are small to medium-sized loans people can get if they are struggling to get by between paycheques. The loan terms are very short – usually a week to a month and a half – and the amounts usually range between about $100 and $1,500. Here are some tips on how to get a payday loan when you are in a pinch.
1. Where to get a payday loan
These loans are given out by money lending stores, and are offered on occasion by businesses that offer cheque cashing and other similar financial services. It is now also possible to apply for a payday loan online.
Traditionally, banks did not offer payday loans as an option; however, it is becoming more common to see banks offering these services.
2. Why someone would need a payday loan
Sometimes, life hands you lemons, and those lemons can get expensive! Payday loans can help for unexpected expenses like a car breaking down, a house flood, emergency dental work or a big vet bill. They can provide that extra push you need to get to your next payday, hence the name.
3. Information needed for a payday loan
The handy part about payday loans is that you do not need a credit check to get one. But, there are some things you will need in order to get that cash in your pocket. Depending on the lender you use, you can expect to be asked for some or all of the below requirements.
You will need a bank account that is open, active and in generally good standing, you need to meet the age of majority for your state or province, you will have to prove that you make a consistent and reliable income, and you will have to provide an valid e-mail address and/or telephone number.
You may also be required to leave a personal cheque for the full loan amount, post dated for the date your payment is due.
4. Benefits of a payday loan
With so few requirements, and with most of them being fairly easy to take care of, payday loans can be preferable to larger, longer loans that have stricter requirements.
You cannot beat the convenience of a payday loan. They are also much faster than other loans. You will often receive payday loans instantly, or within a few hours as opposed to other types of loans that take days and weeks to set up. As well, you are not required to make an appointment or prepare for a payday loan. You just need to find a place that provides them.
Because payday loans are generally for small amounts and short periods, money lending stores do not require a credit check to approve your loan. This actually protects your credit rating, as long as you pay back the borrowed amount in full before it is due.
5. Things to look out for
Even though payday loans are super convenient, no money lending option is perfect and you should always be aware so that you can make an informed decision.
Check the annual percentage rate you are being charged, and try to find a money lender with the lowest one. All money lender interest rates will be high, but some are better than others, so it’s a good idea to shop around.
Payday loans are very helpful for every now and again when you need a bit of a hand with your financial responsibilities. Just be cautious of how frequently you are using these services and make sure to pay your dues on time or it could cause more problems.
