What are payday loans and how to get them

American culture takes its institutions and credit instruments available to consumers very seriously. For this reason, at any time you have access to personal loans, online credits and even payday loans.

Next, we reveal the details of this last type of express financing, which are a very popular alternative. 

What are payday loans?

Payday loans are a kind of cash advance on your next check or pay stub. These fast loans are characterized by 3 basic elements: high interest, short terms and small amounts.

This may explain the tendency of some people to get into debt by abusing this resource and falling into a vicious circle.

LendYou

  • Loan amount: between $ 100 and $ 35,000
  • Term: entre 7 days y 12 months
  • Extra:Interest rate between 6.63% and 485% APR
    Address: 1125 E. Broadway #545, Glendale, CA 9120

Buddy Loan

  • Loan amount: between $ 200 and $ 50,000
  • Term: entre 15 days y 120 months
  • Extra:Quick online loans up to $50,000

MrFinan

  • Loan amount: between $ 500 and $ 50,000
  • Term: entre 15 days y 120 months
  • Extra:Fast loans up to $50,000 for whatever you want.
    Interest rates from 6% to 439% APR
    Finansi Group SL - Calle de las Barcas 2 Piso 2, 46002, Valencia

CashUSA.com

  • Loan amount: between $ 500 and $ 10,000
  • Term: entre 3 y 1728 months
  • Extra:Fast online loans even with bad credit.
    Interest rates between 5.99% and 35.99% APR
    3315 E Russel Rd Ste A-4 Box #105, Las Vegas, NV 89120

Bad Credit Loans

  • Loan amount: between $ 500 and $ 10,000
  • Term: entre 3 y 36 months
  • Extra:Interest rates between 5.99% and 35.99% APR
    Address: Chief LLC, 2661 N Pearl St #431 - Tacoma, WA 98407

When we look at the characteristics of these immediate credits, they stand out:

  • Small amounts. The amounts available for this type of loan are low due to their conditions, and even state laws determine the acceptable limits. On average, they can request from $100 to $1,500.
  • Few requirements. These lenders are generally unconcerned if you have other commitments that exceed the recommended borrowing capacity. They are only interested in you paying, and they do not focus on whether you are in debt or not.
  • What are Payday LoansShort term. As for the repayment of the loan, it is usually done through a single installment. This can be on your next payday, fortnight, or the moment you receive pension or Social Security income. The cancellation date is established in the contract and is usually a period of 2 to 4 weeks.
  • Payment. It is usual that to return the money you have to issue a postdated check that includes both the amount borrowed and the fees involved in the process. You can also authorize the lender to electronically deduct your prepaid card, bank account, or credit union. If you don't pay before or on the agreed day, the creditor cashes the check or withdraws the funds from your bank.
  • Deferrable expiration. Depending on state regulations, you may have the option to renew or extend a payday loan on the due date. This allows you to pay a penalty for the extension and for the lender to designate another cancellation date.

How to get a payday loan

Payday loans are very popular financing instruments that you can find at a convenience store, loan office or through the Internet. The most essential thing to process this type of fast loan is the pay stub or proof of payment from your employer in which your current income is indicated.

It is common for payday loans lenders to give you up to a percentage of your income. There are other factors that can affect the terms of the agreement, such as credit history and credit score, which are obtained from an exhaustive investigation during the application.

Payday loans interest rates

These fast loans have the particularity of being quite expensive. In fact, the average interest rate is in the order of 500% APR, which might seem like an exaggeration when you compare them with other options, like personal loans or credit cards.

This is due in part to the urgency of the people and the exception that lenders have to charge the 35% indicated in the usury laws of some states.

It is not strange that they take advantage of some gaps within the system to have such large profits. While there are states that simply ban payday loans, in others people have boosted their popularity to have another source of financing. For this reason, these payday credits should be the last of your options.

For example, there are states that establish a charge between $10 to $30 USD for every $100 dollars borrowed. In California, for example, one of these lenders is free to charge a 459% APR on a 2-week loan. In addition, you have to add the administrative costs, which can be up to $18 for every $100 granted in this way.

We remind you that the federal law on transparency for loans (Truth in Lending Act), establishes that these lenders must let you know all charges and fees.

Español: Qué son los préstamos de día de pago (payday loans)