Payday Loan Pros & Cons

Payday Loan Pros

Payday loans, or cash advances, are extremely fast. The application process usually takes only a few minutes, consisting of simple fill in fields including your bank account information. After submitting the application, the approval process begins, and is usually instant or only takes a few seconds. This means that in a few seconds time, you'll find out whether you are approved for your payday loan. The majority of applicants are approved instantly and collect get their cash within hours.

These personal payday loans are available to most everyone. Borrowers can have bad credit and still take out a cash advance, no questions asked. In fact, most lenders do not even perform a credit check; because payday loans are considered a short-term cash advance, no credit check is needed. Simply a postdated check will usually suffice.

Payday loans are sometimes the only option when you are faced with an emergency expense and need quick cash. If, for instance, you are facing unexpected medical bills or car repairs and need cash fast, an unsecured payday loan can be your best friend, providing you with the cash you need, usually within 24 hours.

Payday Loan Cons

The biggest disadvantage of payday loans is their high cost. Most often, borrowers pay roughly 15 dollars for every 100 dollars borrowed for two weeks, although these costs can vary. This may not seems like a huge interest rate, and often times it makes sense to avoid credit card over limit fees and overdraft fees. But broken down annually, the APR can seem staggering, at times going over 500%. Thus, it is obvious that for long-term loans, payday loans are not an option. For short-term, quick, emergency cash, on the other hand, a personal payday loan may be the only option at times.

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