What is the process for Payday Loans function?
Payday loans operate differently than consumer and personal loans. Based on the location you reside and where you live, you can apply for payday loans via the internet or the physical branch of payday lenders.
Different states have their own laws governing payday loans, limiting how the amount you can borrow and how much the lender is able to charge for interest and other fees. Some states have a ban on payday loans altogether.
If you’re granted payday loans and you’re approved, you can receive cash or a cheque or have the funds deposited into your account at a bank. You’ll need to repay your loan completely, plus the finance fee by the deadline, which is usually in 14 days, or on the time you receive your next paycheck.
Payday loans are subject to an interest rate that is usually determined by your loan amount. Since payday loans have such short payment terms, they can result in a high APR. Based on the Consumer Federation of America Payday loan APRs typically range from 400% to greater.
Despite the expense, The Economist estimates that about 2.5 million American households use payday loans each year. There are several reasons for this increased popularity. The most important reason is that a lot of people who take out payday loans don’t have other funding options. They might have weak credit or have no income, which can make it difficult for them to be able to get a personal loan with better terms.
Another reason could be a lack of understanding about alternative options or the fear of having one. For instance, some people may be reluctant to ask relatives or friends to help. While other alternatives for payday loans exist, they’re difficult to locate.
Many people use payday loans because they’re easy to access. In 2015 the number of payday lenders outlets across 36 states than McDonald’s stores in the 50 US states as per the Consumer Financial Protection Bureau (CFPB).
Payday loan lenders do not have any conditions for approval. They don’t conduct any credit checks or demand that the borrower is able to pay back the loan. The only thing you need is proof of identity and a bank account that is in good standing and a steady source of income.
Benefits of Payday Loans
Here are some advantages of getting a payday loan through Advance America:
Easy to apply
Payday Loans are easy applications that you can fill out within a couple of minutes. Advance America lets you apply on the internet or in a store which means you’ll have the ability to fill out an application in the convenience of your own home.
Advance America offers an instant decision on approval, which means you can find out within minutes if you’ve been accepted for a Payday Loan. If you’re approved, you’ll get your money on the very same day that you apply or in 24 hours.
Good credit is not necessary
Advance America has less strict credit requirements and accepts applicants with all credit scores. We take into consideration other aspects beyond your credit score in deciding if we can accept you, including your earnings, employment background, and your current debts. This means you could be approved even if you have fair or poor credit.
Payday Loan rates and conditions
The standard fee for a payday loan is $15 for each $100 borrowed as a predetermined price for a quick-term transaction. The fees differ by state according to the state’s regulations. Make use of our Payday Calculator for Loans to find the rates for your state.
How are Payday Loans compared against other payment options for short-term use? Payday loans are usually the least expensive alternative to bank overdrafts and bounced checks or late payments as well as the cost of reconnection to utilities.
What are the requirements to apply for a payday loan?
For application, you’ll require the required items listed below:
- Government-issued ID issued by the government.
- The source of income
- Checking your account
- Social Security Number, also known as ITIN (in stores only)
- Personal checks are required in certain states