One of the main benefits of a payday loan is the speed at which the cash can be credited to you. The money you need can be available to you in your bank account on the same day that you make the application. This can provide valuable assistance if you have a short term cash flow problem and need money in an emergency.
Simple
The application process is very simple, it takes just minutes to apply for a payday loan and you do not have waste time posting or faxing documents to the payday loan provider, as you would with other more traditional high street loans.
Poor Credit History
Payday loans are available to people with a poor credit history. This is because payday loan companies do not solely make their decision to lend based on a persons credit history. As long as you fulfil the application criteria you have a good chance of obtaining a payday loan. For many people a payday loan may be the only way they are able to obtain credit, especially in the current financial climate where the majority of lenders are unwilling to provide Payday Loans Near Me altogether, never mind to a person with a poor credit history.
Use of the Loan Money
You do not have to tell the payday loan provider what you need the payday loan for. You can use the money for whatever you want. You may need money in an emergency which can not wait until payday for instance; emergency medical or dental treatment, to settle a bill quickly, extra spending money on holiday or even for a romantic weekend away. The choice is yours as long as you make the repayment due on the repayment date.
No Upfront Costs
There are no upfront costs associated with a payday loan. You do not pay anything back until the repayment date you have agreed to in the loan agreement.
Why does the APR appear high on payday loans?
The APR applied to payday loans appears at first glance to be high. This is very misleading, but there is a simple reason why this figure looks so high. APR is an Annual Percentage Rate, and as such is calculated over a whole year (365 days). However, a payday loan is taken usually only over a number of days or weeks.
The APR calculation was not designed to apply to very short term loans such as payday loans. It was designed to apply to long term loans in existence for a year or more. It is really a theoretical figure than enables people to compare similar longer term loan products, like mortgages or ongoing credit balances.
Rather than relying on the APR rate it is more advisable to look directly at the loan agreement to see exactly how much interest you will be charged for the period of your payday loan. Some companies have a standard interest charge for the amount you wish to borrow regardless of the duration of the loan. It is then up to you to decide whether you will be able to repay both the cash advance you receive initially and the interest amount on the repayment date.
To Conclude
Many people do not have savings or access to credit cards or more traditional loans and so the convenience of a regulated payday loan provides piece of mind should the occasion arise that they need some money quickly.
If you need money in a hurry, can not wait until payday and are confident that you can make the necessary repayments on the repayment date, this could be the ideal solution for you.
