Looking for fast payday loans? Slow down. They’re a great solution for temporary problems, but you need to know how to borrow responsibly first. Learn here.
There are two old sayings most of us are familiar with: “Expect the unexpected” and “When it rains, it pours.” There is truth to these phrases in life, and sometimes you will find yourself in unforeseen situations where you need cash now, cash that you don’t have.
When it comes to money, even with a decent amount of savings, it’s not uncommon for most of us to find ourselves in a situation where we just need a little bit of help.
You keep enough saved up for an emergency, but what happens when two emergencies happen in a short period of time? Our weekly spending hardly phases us when we are financially comfortable, but when we are hit with an unexpected bill and are struggling to restore balance, all those weekly costs can add up.
Luckily, payday loans are available to assist you when you need it most and have no other option.
What’s a Payday Loan?
Payday loans are quick, short term loans you can usually get within hours. They tend to be a lower amount of money (usually $1000 or less) and come with an above average interest rate, but they are designed as a short-term loan.
The general concept is the loan is for emergencies when you need cash now. You ideally want to pay back the loan with your next paycheck, or as soon as you can.
Payday loans can have a bad reputation, but that’s primarily due to them being used in impractical situations (I reiterate their purpose as a short-term loan).
The interest for these loans can be reasonable, so long as you pay it back promptly. Most bad experiences with payday loans are due to the loan being kept alive for too long.
You always need the right tool for a job. Now that you have a better understanding of the purpose for a payday loan, it’s easy to understand that they are an effective, reliable solution for certain situations, but not every situation.
So, You Need Cash Now
You’ve weighed all your options, and you have no other viable alternatives. You need a payday loan.
This can seem a bit intimidating for first-timers, but remember that payday loans are there to help you, to remove that uncertainty, not stress you out more.
Keep the following tips in mind when applying for your payday loan to borrow responsibly, and feel safer and more secure with your decision. After it’s all said and done, I guarantee you will be glad this option was there for you.
Borrow Only When Necessary
You should only take out a payday loan when you need cash now, it simply cannot wait without consequences. There is a slightly high-interest rate, so these aren’t loans you want to get on a regular basis for unnecessary purchases.
These aren’t loans you want to have out for a long time, either. This is a quick fix to a dire situation, and you want to pay back the loan as soon as you can.
Consider all your other options and alternatives first. What amount do you actually need? Is there any other source you can get these funds from? Can you manage to wait until your next paycheck, with minor inconveniences?
Payday loans are there to assist you and help, just make sure they are the last option, not the go to backup plan.
Don’t Borrow More than You Need
You might be tempted to go for the biggest loan you can get. But don’t forget to include the interest rate in your planning, and only borrow the amount you really need.
If the interest rate is 1% a day, that’s one dollar a day for $100, but five dollars a day for $500 (with a weekly rate of seven dollars versus thirty-five dollars).
You don’t want to get a loan you can’t repay and find yourself worse off than you were before. The purpose of a payday loan is to help you, not hurt you.
Know Your Lender
There are a lot of payday loan companies out there. Unfortunately, with this field of business dealing with money, there are also a lot of scams and companies involved in fraudulent activities.
When applying for a loan, most companies will need some banking information, so make sure the company you choose is 100% legal and legitimate and has a good reputation.
With this being an emergency situation, you also want a company with a quick and easy application process, who can get you the money within hours.
Find a reputable payday loan company with high approval rates who believe in giving everyone a fair chance when they are asking for aid in a time of need.
Understand Your Agreement
Make sure you understand the terms and conditions to your agreement. You want to know what you are signing and what your legal obligations to the loan include. Don’t be afraid to ask about anything you may feel uncertain about.
You want a clear idea of the interest rates, any fees, when your payment is due, what the late fees are and how they work, and any other questions you might have.
You don’t want to find yourself in more trouble by accidentally missing a payment. You also don’t want to find yourself stuck with a bill higher than you expected because you didn’t understand your interest rate properly.
Also, remember to be honest with your loan company. Most of the good payday loan companies, while also making money, are also doing this to help, as primarily most of their customers are people in a rough spot.
They would rather receive a call with an explanation as to why you will miss a payment and make a new arrangement. The alternative, where they can only get a hold of your answering machine after a missed payment, usually makes them fear the worst.
They can’t be understanding and possibly offer more assistance if they don’t know what’s going on with you and your loan.
When you need cash now, a payday loan company isn’t just giving you the money, they are giving you a stress-free opportunity to catch up when you are behind in life. As long as you are responsible in your decision to get a short term loan, then you have nothing to fear and only comfort to gain.