Payday loans have become quite popular with most lending companies. This is a short-term loan that can be deducted from your next paycheck. It is more like a cash advance which you have to pay when your next paycheck arrives. They have proved helpful in several instances, especially when facing cash emergencies. The amount you can access depends on your lender or payslip.
The Advantages of Payday Loans
The advantages related to payday loans are basically two.
The first consists of the fact that practically no guarantees are required to disburse the amounts, and all the “bureaucracy” associated with the normal request for a loan is eliminated. In times of credit crunch, with banks (above all) and financial companies asking for endless guarantees and documents, it can represent an undoubted advantage.
The second has to do with delivery times. Very often, the requests can be sent directly via the Internet. We talk about 10-15 minutes from approval to have the amount available. In some cases of a few hours.
In short, these are quick and easy to obtain loans.
It is not always necessary to have a current account on which to transfer the requested amount. Some companies do not allow the maximum amount payable to be requested immediately, based on the growth of the confidence index ( trust rating) attributed to a customer. In practice: the more loans are requested and repaid on time, the more the value of this index rises and, with it, the possibility of asking for larger sums.
Are Payday Loans Cheap?
To answer this question, it is necessary to agree on the term “convenient.” Considering only the economic aspect, payday loans cannot be considered the best choice for those looking for a small loan. The rates applied, at the limits of usury (and perhaps even beyond), are really high.
It should also be considered that if it is not possible to repay the small loan obtained, it can lead to a real surge in rates and expenses, such as reaching levels that are difficult to accept. If, on the other hand, by “convenient” we mean something useful and suitable to meet your needs, then payday loans can be considered as such, in the sense that they allow you to have small amounts quickly and “without too many questions,” to be repaid quickly. So no guarantees to provide or endless papers to sign. You should go through a lender’s terms carefully before borrowing.