Payday loans have really increased in popularity in the last couple of years. This is because it is an easy way to get instant short-term loan when you are really in need of money. Their growing popularity and demand has actually inspired the lenders to have a presence online as well. So, now you don’t even have to leave the comfort of your home and can simply log in and apply for a loan.
The Only Option for Some:
Payday loan is actually an easy and convenient option for some people, who are unable to secure a loan otherwise. People who have a bad credit record might find it difficult to get a short or long-term loan and payday loans are the only option left to them. In fact, if you pay up your payday loan on time it can actually help improve your credit record. As these loans are typically for a smaller amount and it is short term, it is easier to pay up.
Points to Keep In Mind before Signing for Payday Loan:
As it is so easy to apply for, some people are really tempted to sign on the dotted line really fast. As a result, some of us are trapped in a sinkhole of debt without even realising it. There is actually a whole bunch of lenders, who would like to trap in some unsuspecting person in need of money and then force them to repay a lot more than what they are supposed to pay.
It is therefore best to keep some things in mind before actually applying for a payday loan:
- Check the rates carefully and calculate how much you will have to pay up finally for the loan.
- Look for flat rates rather than rates that are ambiguous and difficult to understand and calculate.
- Be sure to check how and when the payment will be taken. Check if you will repay through check or will get directly debited from your savings account.
- Terms of repayment needs to be thoroughly checked.
- If the loan looks too good to be true then it probably is. Remember, the lender is also here to do business and make profit so there can be no magic happening here.
- Check for any complicated terms in the fine print that is difficult to understand and check it up with the lender.
- Read the terms and condition repeatedly to make sure that you do not miss some important point.
- Do online research to read reviews of the lender.
- Before applying for payday loan be sure that you have explored all other options of borrowing money.
- Be sure to furnish correct information in the application form. Incorrect or ambiguous information can lead to slowing down of the loan process. False information can also lead to a decline of the loan application.
Don’t get into a habit of repeatedly applying for payday loans. These are supposed to be a one-time option for your financial crisis and you should apply for it only if you are sure you will be able to pay up this short-term loan on time.