subject: Why People Uses Payday Loan [print this page] Why People Uses Payday Loan Why People Uses Payday Loan
Payday Loans are mostly used by people who need cash instantly. There are so many situations that can be considered emergency; it can be for car repair, avoiding overdraft fees, bills etc. This is a short term kind of loan which means it has to be paid back in a short period of time. Since it gives you a short span of time to pay back this loan, this is advised to be used in emergency cases only or to avoid any fees. This offer higher interest rate than the regular lending companies that is why, you will have to use this wisely and responsibly.
This type of loan offers fast and easy approval. Unlike other lending companies, you can apply for a loan anytime anywhere because you can simply do it online. You can escape the traditional visiting the bank personally and talking to a manager hoping that your loan will get approved (you will save time and gas too!). There's a big difference too in terms of documents that you will need to submit, with Payday Loan, they usually require just your Paystub. Approval and all other transactions are faster too, you can get the money you need in a matter of hours. Considering these, for me it's okay to get one even if it has higher interest fee.
The APR for this kind of loan is totally different from other kind of loan. You might be thinking of 300% APR or maybe higher, especially when they set APR into 1000% range and above. When we do this, this will give us a sky rocketing APR and gives us the idea of considering this kind of loan costly. This high APR is because of the reasons like this kind of loan is designed as short term loan and not for a long term which is APR system is measuring. These kinds of loans are paid in a short period of time which ranges from 1 to 30 days or on your next pay period and being charged a fixed interest fee depending on the amount you loaned. If we are to use the APR system, we also have to extend the pay period of a loan but that is not how Payday Short term loan works.
This kind of lending company not just caters people who have good credit standing; they extend their service to those who do not have perfect credit record. They maybe charging higher interest fee, but most importantly they do tell their customers clearly what they are signing up for.
