If you’re in a tough financial situation and are in need of cash fast, payday loans might just be the answer for you. So what is a payday loan? It’s a short term loan, also known as cash loans, that must be paid back typically within 30 days or your next pay check. There are a few advantages and some disadvantages to receiving a payday loan. Let’s take a look at some of them as well as examine other options you have depending on your situation.
Being approved for a payday loan is relatively simple. typically there are no credit checks and approval is immediate. Most payday loan lenders can wire the funds to your bank account within a few hours so you have the cash by next business day. To be approved for a loan, you simply need to be 18 years or older and be employed. A payday loan can be used for anything you’d like. They usually vary in size between $100 and $1,500; however, most states have regulations on the amount you can actually borrow. Cash advance loans can serve as a real easy solution when a financial emergency happens.
One of the biggest disadvantages of a payday loan is the interest rates and fees charged. It is common to be charged a $10 to $20 fee for every $100 you borrow. For this reason, payday loans can be expensive, which is why I advise you use them only for emergencies and ensure that you will be able to pay them back within a paycheck or 2.
There are other alternatives to cash advance loans, such as personal loans, which can be paid back in 12 to 36 months; however, they do require credit checks and can take a few weeks to get the money. There are credit cards">credit cards that offer cash advances which do not have to be paid back quickly, but over time that balance can increase since the interest rates are still high.
