Let us define first what is a payday loan. Most of us call it as a cash advance, post-dated check or check advance loan. This is usally short-term and would not exceed more than $500 but has a very high interest.
In times when you need something like an emergency happened and nowhere to get the money from? If you do not have other means like credit card or a tangible savings, have consulted your family members or your friends but couldn’t find someone to lend you the money? You will start thinking that payday loans or cash advance would be your last resort. I would like to call it as a “quick fix”. The Federal Trade Commission, in lieu, in the United States of America calls it “costly cash”.
Examples you would need payday loans:
- Short of rent
- Need to do groceries
- Payment of utilities on due
- Medical or car repair bill;
And these are just immediate samples. Now, let us look at the two sides of the coin;
- Approved immediately
- No credit check
- Processing takes less than 30 minutes
- No co-maker is involved
- Get the money within 24 hours
- You can even get it online
- Very high interest
- Renewable and extendable, which will put more interest
- High finance charge
Actually, it depends on how the borrower manages its finances. Payday loans come handy depending on your immediate situation just like any other loans. Just remember, if you are to take payday loans, make sure that do not extend it too much or make another rollover, because this puts more burden on your expenses, more than doubling the interest!
In soon time, learn to manage your expenses and finances and you would not have to rely always on payday loans.