Payday Loan Lenders Are a Simple Way to Get Out of a Financial Bind
Most all of us have been in a position at some point in life where we need a little financial help to get us to the next paycheck. Whether it is an unexpected medical bill, an expense related to your children’s schooling or sports, an untimely car repair or maybe a simple mistake with your bank account – at certain times financial binds will occur.
When we find ourselves in a tough spot financially, one simple way to make ends meet is a cash advance or payday loan. This option is available to most everyone. More often than not, the only two requirements of payday loan lenders for this type of loan are that you have a current checking account and are employed.
Before making the decision to take advantage of this type of advance, it is important to understand how the program works. Generally speaking, a lender will require an individual to provide them with a postdated check from a valid bank account.
This check will be written for the amount of the requested loan plus the associated interest. The lender will provide the customer with cash and when the date specified on the postdated check arrives, the customer will be expected to make full payment.
If the customer fails to provide payment in a timely manner the postdated check will be deposited and funds will be drawn from the customer’s account. Most lenders of this type will allow the customer to extend the advance for a specified time period if needed. If this occurs the process will start over. A new postdated check will be provided and additional interest is charged to the customer.
Critics of this type of program will warn against the high-interest rates associated with the advance. Although the interest rates are high, these programs are still a very viable solution for consumers who would prefer to avoid taking on an additional monthly payment. With an advance, you borrow money; pay it back all at once, and then you are done with it.
There are no long term monthly payments that will need to be worked into the monthly budget. Some consumers get into trouble by continuously extending their advance month after month. It is important to be aware of this fact prior to accepting an advance so you plan accordingly and borrow money responsibly.
All in all, this is a great option for consumers who have limited options, and those who prefer to avoid long term repayment obligations.