There are individuals that live paycheck to pay check and may not have cash in a savings account to cover an unexpected cash expense. Some may find that they are in need of quick cash for a family emergency, unforeseen car repair or medical bill. Whatever the reason, one can now receive a short term loan or cash advance quickly by applying for a payday loan.
If you are in need of a payday loan, it would be prudent to review each payday lender before deciding on which company to do business with. There are a plethora of payday loan establishments to choose from and each varies on rates and repayment terms.
Payday loans are usually small cash advances in the amount of $100 to approximately $1,000. If you are a first time borrower, a payday lender usually has a set ceiling on what can be borrowed based on your income and whether you are paid weekly, biweekly or monthly. Once you have paid off your first payday loan advance, a payday lender will usually allow you to borrow more provided your income and place of employment has not changed. Most payday lenders require that you have been at your place of employment for at least 3 months; the required length of employment varies with each lender.
Before choosing a payday lender, it would be wise to review each payday lender’s rate as they may vary considerably. If you are applying for an online payday loan, make sure to read the wording carefully as it may be somewhat unclear. When reviewing the information on a payday lender’s website, make sure to note, “$11 per $100 borrowed per week” as opposed to “$25 per $100 borrowed”. Choosing the payday lender with the best rate would depend on your payment schedule.
Most payday lenders expect cash payment in full when you receive your next pay check. If you were paid weekly, then the payday lender that offers $11 per $100 borrowed per week would offer you the best rate. However, if you are paid monthly, then $25 per $100 borrowed would be a better rate provided $25 is a set fee until your next payday. If you have any questions or the terms are unclear, take a moment to contact the payday lender to obtain clarification on the loan.
When obtaining a payday loan, it would be wise to only borrow the least amount necessary. As a payday lender expects payment in full by your next pay check, you want to make sure that you have enough money left over from your next pay check to pay your upcoming bills. If you do not have the necessary funds to pay your bills you may have to ask for an extension or make a minimum payment if the amount of your loan is proportionate to your whole pay check.
Asking for an extension or making a minimum payment usually accrues additional fees from the lender. These fees will add up over a period of time if your loan is not paid off quickly and cause additional financial woes.