If you’ve ever taken a loan, then chances are that you are familiar with the main advantages and disadvantages of bank-issued loans, credit cards, mortgage loans and other types of loans being offered by banks.
To put things better into perspective, the main disadvantage is the fact that personal loans are given for long periods of time, and that the sums are generally too large to deal with a simple, small, emergency financial situation. Not only this, but they often take a long time to be approved, whereas the funds are also delivered slowly. Apart from this aspect, it is also worth pointing out that those who are dealing with bad credit, often face trouble when it comes down to getting a personal loan from a bank.
On the other side of the spectrum, payday loans do not have any of these disadvantages. Based on this aspect, payday loans are designed in order to be offered to people with an active part-time or fulltime job, for short periods of times. Not only this, but the loans are also approved fast, and sent within a couple of hours, thus making them perfect for short-term financial emergencies and issues. Most of the times, payday loans are of a few hundred dollars, thus significantly lower than those being offered by banks.
Regardless of the main advantages, many people are still unsure about the steps that they need to follow in order to score a payday loan. Without further ado, here are the main steps that need to be followed to get access to such a loan in no-time.
1. Choose the right payday loan agency and gather all the documents needed
Choosing the right payday loan agency is quite easy, and shouldn’t take you too long. Based on this, firstly look for the agencies near you, and check which ones are registered with a financial authority, and offer transparent tariffs. Once you have found an agency that fulfils these requirements, simply get in touch with them via mail, phone, or in person to learn more about the services being offered, the types of loan that they give, payment terms and turnaround time for the payback.
2. Hand them the documents required
Most payday loan agencies will ask for proof of income, from either a part-time or fulltime job, based on the size of the loan that you would like to get. You should also show your ID, in order to prove that you are at least 18 years old. There may also be times when you’ll need to show proof that you are currently not dealing with bankruptcy, but this is not always required, yet it depends on the agency and size of your payday loan.
3. Fill out the borrowing application, and don’t be afraid to ask any questions
After getting all the documents and submitting them, you should go ahead and fulfil the application, which can be done either in person, or via the internet. Details should include your bank account number, contact information, ID, interest rate, penalisations etc.
4. The agency will not either give you the funds in cash, or deposit them to your bank account
If the funds will be deposited in the bank account, then chances are that you’ll get access to your funds in a couple of hours, or in the next business day. Cash payments offer somewhat of an advantage, considering the fact that you get rid of the bank fees, and are offered the funds somewhat faster, especially if you’re dealing with a financial emergency that needs to be solved as soon as possible.
5. Paying the funds back
Most payday loan agencies will simply try to debit your bank account, and take the funds alongside with the interest rate directly from there, once the time present on the contract has come. In case you do not yet have the funds, it’s best to get in touch with the payday loan agency, and explain your situation. These can give you better tariffs, and more time to pay the money back, without having to deal with a bad credit score. Getting another payday loan from another agency to pay back to existing debt isn’t a good idea, as this can put you into a vicious cycle of not affording to pay the money back on time, thus dealing with even more debt.
Based on everything that has been outlined so far, getting a payday loan should be quite easy for anyone who is over 18 years old, and can show proof of current employment. There are also some tips that need to be followed while in the presence of the loan, such as trying to save more money, in order to make sure that you can afford to pay the interest fee once it is due as well.