Your credit cards are maxed out and your bank account is down to $3, when surprise surprise, your car breaks down. You need to get your car fixed so you can get to work, but you wont be getting paid for another week, so how are you going to pay the mechanic? A payday loan may be the answer.
A payday loan is a special type of loan designed for when you need a little extra cash in between paydays to cover unexpected expenses. Generally you write the business a personal check for the amount of your loan, plus interest and fees and then the business holds the check until your next payday when you will have the funds available.
Payday loans generally come with several fees and operate at a much higher interest rate than other loan types, so be prepared to pay a good 10%-20% more for your loan than cash you’ll actually walk away with in your hand. The fees you pay however to a payday loan service are often much lower than the fees you would end up paying if you were to bounce a check, or have to pay late fees on your credit cards and other debits.
You can find payday loan offices located at least a few different places in every major city. In additional to physical offices many payday loan services have internet sites where you can apply for a loan and have funds deposited directly into your bank account.
So, should you get a payday loan?
The first thing to think about is whether or not you are legitimately going to be able to afford to pay back your loan with your next pay check. A small loan can turn into a huge expense if you are unable to pay your loan back after your first loan term and have to take out another loan from the payday loan service to cover your original one. Many people have gotten themselves caught in a downward spiral of debt by taking out a payday loan that they can’t really afford, and then continuing to take out loans building more and more debt that they still are unable to handle. Don’t borrow more from a payday loan service than you are going to be able to pay back with your next paycheck.
If you have bad credit, then a payday loan service is a great option for getting money quickly. A payday loan service will generally not run your credit, or at least the credit check that they run will not be as intensive as other creditors may run.
A payday loan can also be a great option if you need cash, and you need it immediately. A payday loan can often put cash in your hand, or in your bank account immediately after your approval. This can be great when the unexpected happens and you need the money right away.
A payday loan can be a great option, when you need money quickly, and it seems like you have no other options available. Make sure before you get a payday loan, or any loan, that you read through the terms and conditions of the loan and know exactly what your getting into. Going in educated in your loan will help you make sure that you make the most of your loan, and aren’t hit with unexpected expenses and fees along the way.