Payday Loans

A payday loan is an unsecured short-term cash advance for relatively small dollar amounts (generally between $100- $1,000, depending on borrower’s income and state law limitations).
It is typically repaid on the borrower’s next payday – usually with a clearly stated fixed fee that is a certain dollar amount for every $100 borrowed, which represents the lender’s profit from this transaction.

Under most circumstances, payday loans are fairly easy to get, as long as you successfully meet the minimum requirements.
In order to qualify, the basic requirements from a potential customer are pretty simple, compared to other common types of loans: proper personal identification, an active bank checking account (for direct deposits) and a current source of regular income, either from a steady job or from governmental benefits.

They are provided by non-bank lenders as well as private financial services and are designed to help people pay for unexpected immediate expenses and financial emergencies.
It is called a payday loan because the money lent is supposed to financially help the borrowers get through to their next payday.

Each state in the United States has its own set of laws, rules and regulations surrounding licensed direct lenders, such as the maximum amount of money these businesses can lend to their customers.
Some states have legislated strict laws that protect the consumer from excessively high interest rates (APR) or fees, by placing a cap on the total cost of credit.

It’s important to remember that these loans are just temporary in nature and are definitely not structured to offer a long term solution to ongoing financial difficulties.
If you are consistently struggling with expenses month-to-month, taking such a loan will not solve your root problems.

What Are Payday Loans Used For?

In most cases, such a cash advance has no restrictions, which means you can use the funds you receive for basically any purpose – however, here are some of the most common uses:

• Any Financial Emergency
• Urgent Car Repairs
• Unexpected Medical Treatment
• Household Repairs
• Utility Bills
• Surprise Expenses
• Overdue Bills
• Rent Payment

Benefits

Taking an online payday loan can sometimes help you avoid various unpleasant financial situations, such as credit card debt, pending late fees, overdraft fees, bounced checks, damaged credit scores, etc.
It can bridge short term, temporary financial gaps until your receive the next paycheck.

If turning to your immediate family or closest friends for help is not a realistic option and in case there are no better alternatives, it can be an easy source for fast cash, especially if you face an emergency expense or if you have an unexpected bill that suddenly comes out of the blue and has to be paid as soon as possible, without any delay.
The online application process is pretty quick, convenient and hassle-free.
With some lenders, it can be a totally paperless process which requires no faxing and no lengthy paperwork submission.

When typical customers apply for other types of conventional loans (especially from traditional financial institutions, like banks), they usually must have a good credit score just in order to be considered.

Usually, it takes a lot of time to get the application processed and approved, something that makes it extremely inconvenient when you get in a serious cash crunch and desperately need to raise the necessary money quickly.
Some payday lenders make no credit checks with the three major U.S. credit reporting bureaus (Experian, Equifax, and TransUnion), a factor that enables many potential borrowers who have a history of bad credit to still be eligible for an instant loan.

How Fast Can You Get Approved?

Many payday loan services work quickly and offer near instant approval, which means that their credit decision can be given to the customer almost immediately, within seconds, minutes or a few hours at most, usually by email.
Working with cash advance companies that are able to review your loan request the same day is a huge advantage that can save you a lot of time and hassle.
It means that the whole cycle, that includes completing an online application, being approved, processed and even getting the actual funding can be finalized within one day.

These quick money transfers and direct deposits often allow the borrower to get the payout he needs in 24 hours, something that can be quite useful.