Don’t apply for that instant cash loan until you read this post! We’re sharing the 10 things you should consider before applying for that loan! Read more here!
The average New Zealand household has about 12 cents of debt for every NZ$1 they own.
Even if you work hard, pay down your debts, and try to save what you can, sometimes, you just run out of money at the end of the month.
When this happens, many New Zealanders apply for instant cash loans.
Whether you’re applying for a payday advance, emergency instant cash, or for any other reason, asking for a loan isn’t something to take lightly.
Before you apply for an instant cash loan, take a look at the top 10 things you need to know, and the questions you need to ask yourself.
Make an informed decision – not an impulsive one.
1. The Amount You Want To Borrow
Of course, when you’re applying for an instant cash loan, there’s a temptation to take more than what you need.
Try to resist this – especially because the interest rate can sometimes be costly if you’re borrowing larger amounts.
Don’t get yourself into a situation where you’re unable to pay off your loan, and don’t give yourself more money than you absolutely need.
2. Whether Or Not You Really Need Instant Cash
Keep in mind that instant cash loans can sometimes carry an interest rate that’s a bit higher than other loan options.
That means buying that pair of shoes isn’t a good enough reason to get an instant cash loan!
Also, make sure that there’s nowhere else you can get the cash from first. Do you have a family member you could borrow money from? Ask for a payday advance?
3. Choose Your Lender Wisely
Not all instant cash loan companies are created equal. In fact, some of them are flat-out scammers.
When you’re deciding on a lender, do as much research as you can – especially since it’s likely you’ll be required to provide your banking account information.
This isn’t the time to take a chance. Don’t be afraid to ask these companies questions, and to ask for referrals or testimonials from past customers.
Also, make sure the application is quick, and that you’ll get your money as soon as possible.
If your instant cash loan arrives by the time your next paycheck does, there’s no point in applying.
4. Know Your Interest Rate
Once you’ve determined if you really need an instant cash loan and the amount you need to borrow, look into your interest rate to make sure you can afford it.
Our interest rate is about 1% every day, and our APR is 365%.
Recently, other companies have charged a ridiculously high APR of over 547%.
Always have a frank conversation about your interest rate with your lender, and evaluate if you an interest rate truly makes it worth it to apply.
5. Know How You Can Use The Money
When you apply for an instant cash loan, there are usually no instructions about how you are allowed to use the money.
But keep in mind that in some cases, you will be allowed to use the money only on what was agreed upon in your contract with the lender.
Always ask to make sure you can use the money how you want to.
6. Ask About Penalties For Early Payment
Though it might seem like a great idea to pay off your loan balance early, this isn’t always the case.
In fact, some lenders can actually charge you a high penalty fee for paying off your loan too early.
Make sure, before you decide to work with a lender, that you’re aware or whether or not they charge pre-payment penalties.
If so, always get the amount of these fees in writing.
Other times, you not be penalized at all, and could, in fact, get a lower interest rate in the future if you apply for another loan with the lender.
It just varies depending on the loan company you’re working with.
7. The Consequences Of Late Payments
Before you sign anything, make sure you’ve had a frank discussion with your lender about what will happen if you make a late payment.
In general, if you feel you won’t be able to make a payment, let your lender know as soon as possible.
This isn’t just a sign of good faith.
Your lender may be able to help you, rearrange your repayment schedule, or even lower the amount you’ll need to pay.
However, avoiding calls from your lender isn’t going to help you – or your credit score.
Always be proactive if you think you might miss a payment. Remember, your lender wants to get paid! They’ll work with you to make sure it happens.
8. Make Sure You Qualify
Depending on your age and income level, you may or may not qualify for an instant cash loan.
Always check on a lender’s website to make sure you’re eligible to apply.
Also, remember that the amount you are allowed to borrow will depend on several different requirements, especially your income and expenses.
9. Know Your Credit Score
Your credit score tells your lender how good you’ve been about paying back other debt in the past.
If you have a good credit score, you’re more likely to be approved for an instant cash loan.
10. Thoroughly Read Your Agreement
Many instant cash loan companies will try to sneak hidden fees into your agreement. So, before you sign anything, make sure you read yours in full!
You should know:
- Your exact interest rate
- When payments are due
- The fees associated with the loan
- How long you have to pay off the loan
Looking For An Instant Cash Loan Company You Can Trust?
Household debt in New Zealand is one of the highest in the developing world, at a little over 9% per family.
With the average income level hovering around NZ$49,850, many people still find themselves in need of a little extra help sometimes.
If you need instant cash to help cover an unexpected emergency, sudden life change, or even to help pay for groceries, there’s no shame in asking for help.
Still, now that you know what you should consider before applying for a cash loan, you’ll be able to make the best choice for you and your family.
When you’re ready to begin the application process, contact us.