Everywhere you can read warnings about taking out payday loans. They say that this loan type entraps borrowers into a financial mire. While it’s true that there are shady lenders that predate on people who want to obtain short-term loans like payday loans, you can also find many lenders that provide payday loans within the bounds of the law.
If you go to these lawful lenders, you’ll know that payday loans are not bad at all. In fact, you can avail of the several benefits of this type of loan. If you want to know what those advantages are, just read this blog post.
You Can Use a Payday Loan for Whatever Purposes
Yes, you heard it right. Unlike other types of loans, payday loans can be used for almost anything. If you want to pay for overdue bills, make an important purchase, or cover medical expenses, getting a payday loan is a good option.
You can also use payday loans to avoid withdrawing extra funds from your business. Whatever your financial needs, this type of loan can serve as a buffer.
Simple Application Process
Since the advent of the internet, lenders who offer different types of financing are now doing business online. It means that you won’t have to visit brick-and-mortar stores anymore to apply for a loan. Such development in the lending industry proves to be beneficial to the borrowers as they can find loan options and send their loan applications online.
Online payday loans have an easy and smooth application process. Just search the internet for a trusted payday loan provider, type in the important information on the application form, and submit it through the lender’s website for his/her perusal.
You Can Apply for It Anytime
Most online lenders have banking hours available 24/7. If you badly need some cash during the weekends, a lender who offers an online payday loan can provide you the loan amount you need. With this accessibility, it’s not surprising why this type of loan is popular among borrowers today.
Excellent Option for Emergencies
The smooth application process and 24/7 accessibility only mean that payday loans are an excellent loan option for emergencies. You won’t have to wait for several days just to get approved for this loan, and if the lender okays your application, you can get the sum of cash you need right away.
Let’s say that your salary is still a week ahead and you need money because your car needs a repair. It’s workday tomorrow, and you really need your car to go to the office. If you take out a payday loan, you can get the money fast for your car repair, and you won’t have to worry about going to work the next day.
You Can Pick a Repayment Term That Suits Your Needs
When you apply for an online payday loan, your lender will orient you regarding the repayment term options for the loan. Basically, this type of loan is only for short-term financing with a lifespan of two weeks or one month, but some online lenders allow a repayment period of three months.
One benefit of payday loans is that it’s a short-term loan. It means that it won’t impact your finances for a long time, unlike other types of loans. But, with a shorter repayment term, comes a high-interest rate.
Before you consider getting a payday loan, you have to make sure what’s the repayment term that works for you. Just ask your lender if there are ways that the loan you’ll take won’t impose a heavy burden on your finances. You can talk with your lender if they allow for a lower interest rate if you take a payday loan with a repayment term longer than two weeks or one month.
You Can Track the Outstanding Balance Online
Online lenders will give you access to an online account where you can view your personal information, remaining loan balance, and your repayment schedule. You’ll also get notified when the schedule is near. With this great feature, you can keep track of your outstanding loan balance and pay back what you owe on time.
The Cost of Payday Loans are Capped by Law
Since there are many predatory lenders that provide payday loans with excessive interest rates and charges, most states in the US have placed regulations on payday loans.
For example, a lender shouldn’t approve a loan applicant who already has one or more loan obligations. Of course, lenders are not allowed to impose higher rates of interests and exorbitant fees on payday loans. The lending company should also inform you regarding the annual percentage rate (APR) of the payday loan you’ll apply for.
Takeaway
Payday loans already have a bad name due to the predatory practices of some lenders. But if you pick lenders that follow the rules of law in performing their business, you’ll realize that payday loans provide some benefits on the borrowers.
