How Do Payday Loans Work?
You may be considering getting a payday loan but before you decide to go for it, it is important that you understand exactly how these loans work.
This article will allow you to make sure you are making the smartest financial decision and help you feel confident.
What are payday loans?
Payday loans are short term loans that are often used during financial emergencies to get quick relief without much headaches. Usually, these are very small loans where you can borrow several hundred dollars.
Most lenders will require customers to provide a security check which will be cashed if the loan is not paid back in accordance with the loan agreement. When you pay off the loan you will also need to pay for the interest and fees accrued.
How do I Apply for a Payday Loan?
The great thing about payday loans is that they are easy to apply to and obtain. You don’t need to have a good credit score or expansive collateral in order to be approved for some funds. Many lenders, 5 Star Loans included, allow borrowers to apply for a payday loan online. This makes the process simple since you don’t need to wait for hours on the phone or drive down to an office just to complete the application.
As part of your payday loan application you will need to provide bank details and/or information about your income. This doesn’t mean that you have to make lots of money or have much of it in your bank account. Lenders are looking to see that you are able to repay the loan properly and these pieces of information help guarantee this. You will also be required to provide some personal details such as your name, date of birth, address, and phone number. Completing the online application should usually take no more than a few minutes.
Many lenders offer an online calculator on their website. This is an easy tool you can use to estimate the cost of your loan and how the repayment plan will look like. We suggest using the payday loan online calculator in order to understand how this loan will affect your finances.
Do Payday Loans affect my credit score?
If you’ve worked hard to build your credit score you definitely don’t want it to be affected by the payday loan you get. Luckily, most lenders do not report your loan activity to the credit bureaus so there is no worry that your score will be damaged by this loan. We always recommend asking your lender about their credit reporting policy and reading your loan contract carefully to see if it mentions anything on the topic.
It is also worth noting that many lenders don’t even check your credit score when approving you for a payday loan. This is part of the appeal of this type of loan. You don’t need to worry if you have bad credit, no credit, or even good credit that will be damaged. A payday loan is truly for everybody!
Online Payday Loans
We’ve already mentioned that you can apply for a payday loan online but we wanted to take the time to explain this a bit further. Nowadays, people want to get their loan money fast and they don’t want to be working too hard for that. We get that and that’s why we’ve created a streamlined and straightforward online payday loan process. This allows you to be approved and get your money in record times without ever leaving your house.
The online payday loan can be approved within a few hours and you can usually get the funds within a day. This is ideal for cases where you need urgent cash but don’t want to drive around to a loan office. This also saves paperwork and helps protect the environment! Win-win for everyone!
Things to consider before getting a payday loan
Getting a payday loan can be very simple but we suggest customers take this step with caution. Payday loans are high interest loans that can result in customers paying back a lot more than they borrowed. These loans need to be paid back quickly so customers should be very aware of their finances and make sure they can afford to pay everything back within a few weeks of the loan origination. All in all, payday loans should be used as a last resort and with lots of caution. If you’re not sure about whether this option could work for you, speak to a loan agent who can explain the details and help you make an informed decision.
Payday Loans with 5 Star Loans
Now that you know more about how payday loans work, you may decide that this is the right option for your situation. Indeed, while payday loans should be taken with caution, they do have many advantages that make them great for lots of customers.
5 Star Loans is a trusted lender that has served thousands of customers. We provide quick and hassle free payday loans to help you get the funds you need quickly. We also offer an online application to help ease the process and get you on your way.
If you think a payday loan could be the right option for you, give us a call or fill out our online inquiry. One of our professional loan representatives will be in touch with you shortly.