Are Payday Loans Bad or a Valid Source of Quick Money?

This is a question a lot of people have because payday loans tend to get a bad rap. A lot of naysayers will tell you that these loans are bad, always. But, if you have tried a payday loan before, you know that there is much more to the story. This loan is not right for every person or every situation, but it can provide quick money and it can be the best option more often than you realize.

What Are Payday Loans?

It helps to know what these loans are before you make a judgement, or course. A payday loan is a type of personal loan that comes in smaller amounts than other types of loans. They are small so that you can get quick money to take care of immediate needs. They do not provide large amounts of money for big purchases like cars or houses. Payday loans help you pay the week’s bills, cover the rent, or handle unexpected, surprise expenses, like a trip to the emergency room or travel costs for family emergencies.

In addition to being different from other loans in terms of amount size, payday loans are also distinct in terms of approval requirements. You don’t have to have perfect credit for these loans, unlike many others. Most loans come with a minimum credit score requirement, but payday loans do not and are open to many more people.

Payday Loans Really Do Provide Quick Money

What a payday loan can do for you is provide truly quick money. When you do need to get that late bill in before the collectors come knocking on your door, this type of loan is the one that will give you cash quickly so you can get it handled. Approval takes 90 seconds or less and the time from when your loan becomes official to when you have cash in hand is usually less than 24 hours. Other loans can take weeks to get funded.

Payday Loans Are Affordable

One of the biggest criticisms people have of payday loans is that they are expensive. The interest rates are typically higher than those for bigger, long-term loans. The reason is that getting access to small amounts of quick money just costs more. It’s a bigger risk for the lender, so it has to cost more in interest. However, this doesn’t mean these loans are too expensive. A payday loan is affordable because of the short terms and small amounts. The interest rate looks high, but when you apply it to these small loans and repay them in a week or two it comes out to be an extremely affordable amount.

Be Sure You Can Repay a Payday Loan

Where some people may get in trouble with payday loans is not being able to make repayment. Just make sure your next paycheck is deposited into your bank account, and your lender will take out what you owe on the due date. You may need to tighten the belt a little until your next payday, but it is very doable to get this loan and repay it on time if you have a job and regular paycheck.

Are Payday Loans Bad or a Valid Source of Quick Money? By Scott Lobo - 12/13/18