Online cash advance financing is increasingly becoming popular nowadays. Many people in need of immediate cash is capable of getting the financial help they need just by applying online.
Are you familiar with this type of loan? If not, here are some information about this type of lending.
What is Online Payday loan?
Online cash advance is simply a payday loan offered over the internet. As the name suggests, a payday loan is a short term personal loan payable through the borrower’s next salary. Traditional payday loan lenders offer their services from the specific location.
People who want to borrow money can visit the payday lender’s office to fill out an application. They will be required to write a post-dated check to ensure that the loan will be paid on time. The application is reviewed and approved within a few minutes. Once approved, the borrower is able to get the loan amount right away.
But nowadays, many payday loan lenders offer their services from the internet, and thus, the popularity of online cash advance loans. If you want to apply, you can visit the lender’s website, fill-out and submit your application online and wait for approval within minutes. Upon approval of your loan application, the money will be sent to your checking account via electronic transfer.
Indeed, acquiring a cash advance loan online is quick, easy, and convenient because you don’t need to personally visit the lender’s location. Borrowers can also compare different payday loan lenders and choose the one that offers the best deal.
Traditional payday loan lenders also require that the borrower must have a stable source of income or regular employment to get approved. However, it is interesting to note that many online payday loan lenders or online cash advance lenders do not conduct employment screening.
The Risks of Online Cash Advance Lending
Because online cash advance loans are convenient, consumers might be tempted to take out a loan each time they are in need of extra money. However, borrowers are discouraged from relying on payday loans too much. It’s important to weight the advantages and the disadvantages before signing up for a program.
Bad credit payday loans or cash advances are usually accompanied with steep interest rates and fees. Lending companies make up for the risk by imposing higher charges to make profit. In fact, the interest rates can range anywhere from 100% to 300% or even more.
In some States, payday lending is regulated by specific lending laws. For instance, there is a cap or limit on the maximum amount that can be borrowed and a cap on the maximum interest rate. But there are also States where lending laws do not apply so lenders are more likely to take advantage of borrowers in need by imposing excessive rates and fees.
If you have decided to get a payday loan, make sure that you are dealing with a legitimate lender. Last but not least, make sure that you will be able to pay back the loan on time.