• NetSpend Pre-paid Credit Cards
• Free Tax Consultations
• Guaranteed Credit Card

• Apply Now!
• Reduce Debt 60%
• Instant Tax Help

Payday Loans

What exactly is a pay day loan? I receive a lot of e-mails regarding this topic and I have always been a little curious about how it works, so I decided to investigate. Basically, a “pay day loan” is a “cash advance” style loan or “short term” personal loan that provides customers with a quick and easy way to get access to extra cash with limited restrictions regarding their credit history. This is a helpful resource for people feeling stressed out due to unforeseen expenses.

Although there are many pay day loan companies in existence, they each work a little differently, so it is always good to do your homework before deciding which company to go with. Keep in mind, they make their money off of the fees and interest that they charge you on your loan, so be careful. Make sure that you understand the “fine print” and take precautions to safeguard your privacy when giving out personal information.

The company that you choose should maintain a high level of standards designed to encourage financial responsibility and protect your interests. It is understandable that from time to time, we all have expenses that we are not prepared for. If your car breaks down on your way to work and the repair bill is practically the size of a 2nd car payment or your child gets sick and needs to visit an ER on a Saturday and your deductible is the price of a weekend vacation at the beach, there is not much you can do to avoid those circumstances. However, by taking advantage of a pay day loan, you are committing yourself to a new responsibility and entering into a relationship with a lender that you should feel comfortable will look out for your best interests.

Eligibility requirements for pay day loans are somewhat flexible and vary by company. Generally speaking, you must be 18 years of age or older, have a checking account that has been opened for at least 90 days, and be employed making a consistent income of at least $250.00 a week or $1000.00 per month. Usually, the approval process will just consist of employment verification, and not include any type of credit or background check.

There are many companies in this business and each company provides various ways for you to receive your funds. Some companies use electronic transfer which allows you to receive your funds directly into your bank account within 24 hours of your loan being approved. Other companies issue cash cards that work like bank debit cards or pre-paid credit cards. Another way to receive funds is through MoneyGram locations.

A common question that many people ask themselves is, “What if I can not afford to pay back my loan as agreed?” This is a great question because it is likely that if you are already short on cash due to outstanding debt and living expenses, adding another payment to your monthly bills may be tough. Keep in mind, this is a short term loan and will need to be paid back rather quickly.

Many pay day loan companies add on significant fees to the amount of your loan if you are late or miss a payment and you should ask yourself if you can handle the commitment that you are making. For example, XYZ loan company states in their terms that a customer can extend their loan up to three (3) times and only pay the finance charge and the fees that are due at that time. After the third extension, they require an additional payment of $50 towards the principal amount for loans under $500 and $100 for loans over $500. These fees are in addition to the agreed upon finance charges. In addition they require all of their customers to pay double the amount of their regular payment for any loan that extends past 27 days. These types of fees can put you in further financial distress so make sure that you have a full understanding of the extension rules and guidelines before entering into an agreement.

We all need a little help with finances from time to time, and the important thing to remember is to make sure and investigate all of your options to make a decision that you are comfortable with.