A payday loan is a short term personal loan that is most often used to help you meet your financial obligations when you find money to be tight between paychecks. An increasing number of companies are offering payday loans also known as cash advance loans – online, making it easier than ever to get the money you need without leaving home.
Before you Apply
Before you make the decision to apply for a payday loan, you should first make sure you actually need the loan. Emergency situations like unexpected car repairs or a higher than usual utility bill, may make these loans necessary, but don’t take a loan if you don’t think you will be able to repay it on time, otherwise you may only be making a bad situation worse.
It is best to research payday loan companies before doing business with them. A simple internet search will link you to quite a few companies who each have their own requirements and terms. After reading all of the fine print and comparing the offers, you will be in a position to choose the best payday lender for your needs.
What do you need to look for?
Before choosing a payday lender, you need to make sure you understand exactly what the company is offering – including the loan amount, the term (length of time you have to repay it) of the loan and any fees that will be incurred. Just as important are the penalties should you default or find it necessary to extend the length of loan beyond the original term.
Most are guilty of ignoring the fine print of a contract and in the case of payday loans, this can be a really bad idea. Take nothing for granted when it comes to signing a contract (even on the Internet). Don’t ever “take their word for it”. If something is not in writing, you have no legal ground to stand on in order to dispute a problem at a later date.
How to Apply
After researching and when you are ready to apply for a payday loan, you will need to meet a few basic requirements in order to qualify for the loan:
1. All payday loan companies will require that you be eighteen years of age or older, because that is the minimum age for a person to be able to enter into a binding legal contract.
2. Most companies will require proof that you have been employed for at least ninety days at the same job, and that your bring home pay is at least one thousand dollars ($1,000) each month. Pay stubs is usually all that is necessary to meet this requirement.
3. You will also need a checking account, as online payday companies will most often send you the loan via direct deposit directly into your account.
While the specifics will vary from company to company, you will need these basics in the majority of cases.
Be aware that submitting the application for a payday loan is not the same as entering into an agreement with the company for a loan. By submitting the application you are merely expressing an interest in taking out a loan with the chosen company and finding out what the details and requirements are going to be.
Don’t get pushed into taking out a loan if you are not comfortable. You have the right to refuse right up until you sign on the dotted line, and the sales person is there merely to sell a product. Even though you may feel desperate, the payday loan industry is booming right now and there are plenty of companies to choose from.
It might help to think of your situation as if you are in the market for a new car. You go to one dealership because you have seen their television commercials only to find out that the moment you arrive on the lot, a sales person is rushing across the parking lot to get to you before you even open the door. If you don’t like the sales tactics, you will move on to another car lot, right?
A payday loan should be no different.