All You Need to Know About Payday Loan Advantages and Disadvantages

Advertisements for pay day advance loans can be found everywhere. They’re in newspapers and on billboards but more than any where else they are all over the Internet. Some lenders advertise by direct mail as well so you may find their ads in your mailbox too.

They’re called by many names which include cash advance loans, payday advances, check loans and more, but, they all basically mean the same thing. A pay day advance loan is nothing more than a loan to get you by until your next payday.

A pay day advance loan is a short-term loan that will require repayment within 14-30 days. Borrowers may apply for loans that range from $100 to $1,500 depending on the individual lenders policies as well as the borrowers income. There are, of course, advantages and disadvantages to using this type of loan.

One plus is that a pay day advance loan is easy to apply for and it’s just as easy to get approved. Borrowers simply fill out an application that requires such information as where they are employed, their home mailing address, telephone numbers and monthly income. Applicants will also need to provide information about their bank account such as the name of their bank and their account number. The application is much simpler than that of a traditional bank.

Borrowers will need to provide their most recent pay stub, their last bank statement, and a copy of their drivers’ license and possibly a social security card. There is no credit check whatsoever with a pay day advance loan. The process usually takes only a few minutes to be approved instead of days or weeks. This allows the borrower to receive their cash loan in approximately one hour or less. Once approved, the borrower simply writes a post-dated check for the amount borrowed plus the lender’s fees and for the date that their next paycheck will be received.

Getting a pay day advance loan from an online lender is even faster. The loaned money is direct deposited into the borrowers account within hours. Repayment of the loan is made the same way. The lender will be paid by direct withdrawal from the borrowers’ bank account. This withdrawal will be for the full amount of the loan agreement.

Repayment varies for each lender and some will give the borrower the option to roll the loan over or extend it by paying an additional finance charge. The borrower can either pay off the entire loan on the original due date or pay additional fees to extend the loan to a later date.

The other major advantages are that there are no collateral or credit checks involved. Pay day advance loans are usually only available to people who are working but may be given to folks with a fixed income as well. Owning a home, a car or any other property is not required.

As with just about anything in life there is a negative side to cash advance loans. While the advantages are strong there are still some disadvantages to using payday loans. For example, they charge higher loan fees, interest and/or finance charges for short-term unsecured loans. Most pay day loan lenders do however offer flat rates based on the amount borrowed and length of time to be paid back in full.

Jennifer Meinert is an established author who enjoys writing and reviewing many topics including payday loan online and cash advance payday loans. Please visit her site at http://www.cashadvanceresults.com

By Jennifer Meinert

Comments are closed.