Want to know more about the online payday loan process?
Here are answers to the most common questions asked by potential borrowers.
What Is A Payday Loan?
A payday loan is a short-term personal loan that does not have to be secured with any collateral. Its function is to tie you over until your next paycheck when you’re faced with unforeseen bills or other expenses.
This is why it’s sometimes called a cash advance. This type of loan has become particularly popular in recent years as banks and larger lenders have tightened their belts during the economic recession, and are more reluctant to issue regular loans.
Borrowers find that they are still highly likely to be approved for a payday loan, and most applicants are approved within minutes when they apply online via websites like FastCashNearYou.
Payday loans also make a great alternative to credit cards due to their simplicity and relatively small sums.
The amount issued usually falls between $100 and $1,000, dependent on the borrower’s income level. The loan period is usually around two weeks, though technically under state laws this can vary.
If you are faced with an unexpected bill, car repairs, travel costs, or other small expenses that you won’t be able to cover until your next paycheck, a payday loan might be the perfect solution.
However, it is important to make an honest assessment of your financial situation before applying. Using a payday loan to pay off other debts is likely to make you worse off in the long run.
Who Can Apply?
Anyone over the age of 18 living in the state where payday loans are legal can apply for a payday loan online. As long as you are in regular employment (or self-employed) and not on active duty with the military, you stand a chance to be approved.
Most lenders simply ask that you earn at least $1000 per month, have a valid contact phone number, and a basic checking account where the funds can be deposited.
What If I Have Bad Credit?
In most cases, payday lenders do not run any credit checks, so if you have struggled with debt in the past this will not influence your application.
Lenders believe your income and employment status is the most important sign as to whether you will be able to pay back the loan.
As long as you are honest with the application and are using the loan to genuinely cover a short term expense, then there should be no issues.
How Much Does It Cost?
For more details on the fees and potential interest associated with our payday loans, you can check with your lender.
Each loan comes with a fixed finance charge, which is an added fee on top of the amount you borrow.
As long as you pay the loan back on the agreed-upon date, this is the only fee you will have to pay.
Interest and other charges do not kick in unless you fail to make the repayment and default on the obligation.
What Is The Application Process?
The online application process couldn’t be easier. There’s usually just one simple web form and this should take no longer than a couple of minutes to complete.
You’ll be asked for your personal details (name, DOB, address, etc), income information, and later your bank account details so the loan can be deposited.
As long as you complete the form honestly without any mistakes, the automatic verification system will let you know if you’ve been connected to a potential lender almost instantly.
You’ll then be made an offer within minutes. This is usually based on a percentage of your monthly income and will rarely exceed $1,000.
You do not have to accept the offer and nothing is finalized until you digitally sign the agreement.
When Will I Receive The Cash?
Although you can apply at any time night or day, your deposit is dependent on the banks.
As long as it’s not the weekend or a bank holiday you should see the cash as soon as the following business day. So if you apply during the day on Monday, the deposit will be there by Tuesday. In some cases, it may only take a few hours or an extra day.
Is My Data Secure?
Any data you submit to a reputable lender is treated as confidential and will not be sold or passed on to third parties.
Online lenders use the latest encryption technology on the website and secure servers to store the data.
What Is The Repayment Process?
Unlike other loans where you pay installments on a weekly or monthly basis with added interest, payday loans are paid off in full just a few weeks after they are issued.
There are no installments. This is why it’s important to only apply if you can genuinely make the full repayment with your next paycheck. On average the loan term is just two weeks.
On the agreed-upon date, your lender will automatically take the payment (principal + single finance charge) from your designated bank account.
What If I Miss Repayment?
First off, if you believe you won’t be able to pay on the agreed-upon date it is important to contact your lender ahead of time. If they fail to collect payment and no contact has been made, you may then be subject to added charges and interest.
Lenders are also within their rights to begin collection proceedings against you, all of which could negatively harm your credit rating.
In some circumstances, your lender may be able to extend the loan term or renew the loan.
Lenders’ debt collection proceedings adhere to state and federal law and may involve phone calls, emails, and letters.
Still have questions about payday loans? Ask them in the comments below!