What is Payday Loan and how it Works?

by Money in Minutes Marketing

A payday loan is a short-run loan, that's generally due on your next payday. Because the loans are only for such short terms period, the cost of borrowing is very high. Sure, they are an expensive way to borrow money. So it is advisable that you never apply for a payday loan unless you’re 100% certain and pay the amount back as soon as possible. So be cautious to apply for a payday loan, if you can’t pay it back on time, it may affect your ability to get loans in the future.

Payday loans are generally paid for $500 on the loan or less and money is paid directly into your bank account and on your due date, repayment of your payday loan with interest is then taken from your bank account directly.

Features of Instant Payday Loans:

Payday loans are generally for small amounts.
Payday loans typically come due your next payday.
To have a payday loan you must give access to your checking account or give a check of full amount in advance to lenders.

Life is full of balances and unbalances; you never know when you need to borrow money to make your ends meet. Here this Instant Payday Loans can be very beneficial for you. Sure it is risk taker decision but if you get things done in time, then there is no better loan than short term loans.

Example of Payday Loan

Suppose your car broke down and you decide to borrow $500 for the repairs from a payday lender. You’ll write a post-dated personal check for $540 (the amount plus a finance fee) made payable to the lender and apply for a payday loan. When your loan gets approval, the lender will then pay you $500 for a set period, usually 14 days. When period is over, you pay the lender $540 in cash. Remember, if you are unable to pay the debt in full at the end of the term, you will be charged additional fees and other finance charges.

Payday Loans for Bad Credit - What’s it all about and how to get?

Payday loans are the most pervasive loan for people with bad credit and it is ironic that people with bad credit records are the ones most in need of additional money. Here payday loans for bad credit can be very helpful for those who want to rebuild their credit. Payday loans are the best option for those who need quick cash, but they are not always a recommended solution to a money problem. In many cases, payday loans can get you trapped in a cycle of debt and you will find it very hard to get out of it.

Applying Payday Loan for Bad Credit

Before you apply for a payday loan, make sure you are eligible and able to repay it back on time with full payment. Make sure you are aware of all necessary information before you apply for a payday loan for bad credit.

If you are a citizen of India, you need following things:

Proof that you are over 18 and a citizenship certificate
Your contact information, including a telephone number and social security number
Proof regarding your employment status
Proof that shows your bank account has been open for a certain period of time
Your valid email address, in case if you’re not available over the phone

People who are looking for short-term loans should beware of lenders advertising payday loans for bad credit because it's important that lenders make sure a borrower can repay the loan they are applying for.

Why Google hate Payday Loan?

Recently search engine giant Google announced that it has banned all payday loan ads above 36% APR and apply to loans for repayment was due in 60 days from its site, but why?

According to Google “Payday loan ads often lead to unaffordable repayment terms and financial harm to customers”

This move was welcomed by advocates which were demanding this type of strict action for a long time accusing that these payday loan advertisers has long used slick advertising and aggressive marketing to trap consumers into outrageously high-interest rates.

This banning may not be enough for stopping payday loans companies on the type of products they advertise.

Conclusion:

As demand of payday loan is increasing and what’s the harm if you are getting short term loan when you need it the most. But yeah, we will advise that one should only apply only for payday loans if you can pay it back on time.