Are you in need of some cash that you do not have on hand for an upcoming expense? One way to borrow the money you need is by getting a payday loan. Here are a few questions you likely have about payday loans before you move forward with getting one.
What Exactly Is a Payday Loan?
A payday loan is a very short-term loan, which is typically paid back when you receive your next paycheck. They are very easy to get approved for, but come with higher fees and interest rates than other types of loans. This is because a payday loan is considered riskier to the lender, and it is common to charge more to borrow money because of that.
What Do You Need To Get A Payday Loan?
There are only a few requirements to get a payday loan. In addition to a bank account and a valid ID, you'll need to provide proof of the income that you are borrowing against. This can be in the form of previous pay stubs that show much much you make, or bank account statements that show the direct deposit amounts.
Keep in mind that payday loans are not legal in every state, so you'll need to verify if your state allows it. If not, then there are other forms of short-term borrowing that you can use, such as a credit card.
What Fees Are Associated With Payday Loans?
It is very common for payday loan lenders to charge an origination fee for using their services. However, there are also fees if you make a late payment or need to roll over the payday loan to your next paycheck. If you pay off the loan on time then you would only be charged for the interest and origination fee on the loan.
What Happens If the Loan Is Not Paid Back In Time?
If you miss the deadline to pay back your payday loan, you can expect to pay that late payment fee as a result. Unfortunately, the interest will continue to accumulate on the loan until you are able to pay it off. If you continue to miss payment dates and do not pay back the loan at all, it's possible that the lender will try to take you to court for the money or give your debt to a debt collection agency so that they try to recover it.
Share22 March 2023
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