With the cost of living increasing all the time it is getting harder and harder to keep up with payments as they fall due. You may well be finding that your outgoings seem to outstrip your incomings, especially around the holiday seasons. If you are one of the people who are finding this situation to be increasingly the case then you may well find that a cash payday advance loan is something that you could use to help you over those sticky financial patches.
There are any number of fast cash payday advance loan companies out there looking to lend you the money you need. The essence of these advances is that you get a short term loan deposited directly into your bank account, possibly as soon as the day following your application. They are called payday advance loans because the principal condition of you taking out the loan is that you repay the money when you receive the following months (although sometimes you can get slightly longer periods to pay back the money) paycheck.
A significant advantage of these cash payday advances is that you can find payday lenders out there who will be prepared to lend you the money you need without undertaking a credit check on your financial history. This can be very useful if you have had problems with your finances in the past and it has the added advantage of making the whole application process a great deal more streamlined, meaning that you will not need to wait long for a decision as to whether you are eligible to receive the cash or not. In fact you may even find, if you spend some time and look hard enough, that there are some cash payday advance lenders who will be prepared to lend you the money you need even if you do not actually have a bank account.
Before you get too carried away however, there are some hoops you will still have to get through. As the name suggests these loans are cash advances against your next paycheck, which means that in order to qualify for them you really need to be able to demonstrate to the cash payday advance lender that you have a steady income; usually you need to demonstrate that you have received a minimum of six months paychecks from the same employer in order to be approved. You will almost certainly have to provide some form of photo ID as well when you apply so make sure you are prepared when you start the process.
If you are finding that you are increasingly short of cash in the days running up to you paycheck each month then you would do well to consider taking out a cash padyday advance loan which will help tide you over the shortfall and take you safely through to the next month and the luxury of your next paycheck. These cash payday advance loans are provided by a particular type of lender who specialize in providing short term loans for a few hundred dollars up to a few thousand dollars that are intended to see you through to your next paycheck, at which point the loans must be repaid.
The process of getting hold of a cash payday advance is relatively simple. You need to be able to demonstrate that you are receiving a regular income, usually a minimum of six months. You need to be able to prove who you are and where you live. And that is pretty much it. Thus in order to be successful in applying for a cash payday advance you simply need to bring along bank statements for the last few months, some photographic identification and perhaps a utility bill or two addressed to you to prove your place of residence. If you are successful the cash will either be handed to you directly (you can sometimes find lenders who are willing to give you a cash payday advance even if you do not have a bank account), or credited to your bank account overnight. In any event, the cash will be in your hands quickly and without much fuss.
Because, in effect the loans are secured against your next paycheck the lending company may not even require a credit check. This is a great advantage as it means that you will not necessarily have to worry about any poor credit history you may have. This ability to borrow money, and quickly, makes this type of loan particularly attractive to those who have bad credit.
There is of course a downside to this type of loan or advance which you should be aware of. The rates of interest that are charged on such loans can sometimes be very high. The reason for this is that this type of loan is very risky for the lender; someone who receives a cash payday advance might simply disappear without making any repayment and it can be very difficult, expensive and often fruitless for the lender to pursue such absonders. For this reason you need to make sure that you can afford the repayments in advance of borrowing the money.
A cash payday advance can seem like a particularly attractive option if you find yourself temporarily short of cash. The cash payday advance loan is a short term or temporary loan which is effectively secured against your next available paycheck (indeed the payday advance companies often have software which enables them to check to see that you have received your paycheck into your bank account at the end of each month).
But, before going ahead too hastily there are a number of factors that you need to address before making that application. The short and tall of it is that due to the high risk nature of these loans, together with the very short term nature of them the rate of interest that you are likely to be charged can be extremely high.
For example, say that you borrowed $1000 for 3 weeks each month but had to pay $1100 or a 10 percent rate of interest to settle the loan off at the end of each month. A 10% rate of interest is high but if you are desperate then it is not so high that you would dismiss an offer such as this out of hand. However, if you continue to take out a loan of $1000 each month and continue to repay the loan plus the 10 percent interest every month for a year, then at the end of a full year you will end up having paid $1200 for a $1000 loan, which works out to an annualized interest rate of 120%.
It is for this reason that the cash payday advance loans need to come with a health warning. This is not intended to put you off taking up the offer of such loans completely, but you should be aware of the true cost of the money that you are borrowing as this will enable you to make sure that you concentrate on re-structuring your spending patterns so that in the future you put yourself into a position where you are no longer dependant upon a cash payday advance loan to tide your expenditure over each month. This essentially means that you have to review your monthly incomings and outgoings, try to maximize your income, perhaps by taking up another job, and try to minimize your outgoings, by reviewing each and every item of your expenditure and cutting out anything that you think you can do without.
There is much written across the internet on the subject of cash payday advance loans. A large proportion of the information provided on this subject is written with a particular slant. The content is written by individuals and companies who are in essence in the business of trying to encourage you to take out a cash payday advance. That is all very well, and it would not be fair to knock this approach too much. After all, these companies are not breaking the law and they do offer a lending service, or facility that many across the country actually find invaluable each month.
But, these cash payday advance loans should come with a financial health warning. Yes, these loans can get you cash fast, sometimes as much as several thousand dollars, and in the very short term they can appear to be solving your immediate problems. These cash payday advance loans come with a kicker though. The effective interest rate that you can end up paying on these short term loans is very high. In fact very much higher than you may think because the interest rates that are given most prominence are simple interest rates and represent the amount that you have to repay in the short term.
This may be affordable if you need money in an emergency and the cash payday advance is the only area that you believe you can turn to, but what if you need to borrow the money every month. This can happen surprisingly easily as a payday advance is in effect borrowing next months income, which would normally be spent on next months expenditure, early; this poses the problem, what happens next month when you need to pay next months expenditures; you are likely to find yourself short once again.
This article is not intend to put any reader off the use of cash payday advance loans. Rather it is intended to make sure that anyone considering taking out such a short term loan does so in full knowledge that the loan may end up lasting a great deal longer than they originally anticipated and costing a great deal more; so much more that the cash payday advance loan may not be the best option and a more conventional loan a much more suitable alternative. So, before you go ahead and get a payday advance why not look around and make sure that if you do then the cash payday advance is the best solution for you.
By Theo
Filed in Cash PayDay Advance
Tagged with checking account, financial sector, identity, life saver, paycheck, payday lending, photo ID, rolling your loan, state ID, valid drivers licence
January 1st, 2010 @ 5:35 am
A lot of people these days literally live from paycheck to paycheck each month with very little additional cash to spare. This means that when an unexpected event that costs money, or an unexpected bill arrives they have very little money that month to spare. A cash payday advance loan in these circumstances can therefore seem like a life saver and it is for this reason that payday lending is such a big part of the financial sector.
In order to take out a cash payday advance loan you usually need to address far fewer requirements than for most typical lending arrangements. In order to qualify for a cash payday advance you usually need to provide evidence of the following. You must be at least 18 years of age. You must usually have a bank checking account in which to pay the money that you are borrowing (this provides the lender evidence of your identity, the fact that you have a permanent place you call home, and that you are locatable, through your bank). You should be able to provide at least one form of photo ID. Usually a valid drivers licence is acceptable for this purpose but sometimes your state ID is good too. And last but not least you need to be able to provide evidence, either via bank statements or check stubbs that you are in employment and the amount that you earn each month. Usually six months worth of paychecks are required, but you may well find lenders out there for whom as few as two months are acceptable.
The cash payday advance that you take out will usually need to be repaid, including whatever interest charge is added on top, at the time you receive your next paycheck. This period can usually be extended however for a small fee, and of course an additional month of interest being charged.
It really is as simple as that to get your cash payday advance. But to end on a note of caution, these loans can be very expensive to maintain if you end up rolling your loan over month after month. Indeed, the interest on such a loan over the whole year can easily exceed the amount of the loan. This can put you into quite a difficult financial position faster than you would think so only use the opportunity afforded you by the cash payday advance loan companies carefully.