An online payday loan works the same way as it does when you apply for a loan at a brick and mortar establishment except that you don't have to leave the comfort of your home! You simply apply online and if approved, the funds will be deposited into your checking account, usually within one business day. The same terms generally apply but always check with your store or lender.
Payday Loans are designed to provide fast funds in the case of an emergency or unforeseen situation and will come due on your next payday, or in about 14 days. To qualify you must be over 18 years old, earn over $1000 per month and be willing to provide your personal and financial information.
How Much Can I Borrow?
The amount ranges from $100 to $1000 or more, depending upon the lender and your eligibility. Some lenders will only lend a set amount for the first loan and will increase that amount the next time you borrow from them as long as the first loan was paid back in a timely manner. Most of the time, however, the amount for which you are eligible will depend upon the amount of your income.
When Will the Funds Be Transmitted to my Checking Account?
The typical time frame between the application process and the time in which you receive the funds in your checking account will be approximately one business day. In addition, some Payday lenders may be willing to wire the funds to your bank account on the same day you are approved for the loan.
Will my Credit be checked?
Credit checks are usually not necessary as long as you meet the minimum requirements. If you are a US citizen and are over the age of 18 with a checking account and a steady income, you will most likely be approved. Some lenders will specify that the checking account must have been open for at least a month with no bounced checks in order to qualify.
How long do I Have to Repay?
The typical repayment period is 14 days but this can be customized depending on when you get paid and the state you reside in. Higher fees may be assessed for loan periods that exceed 14 days, though. You may be able to renew your loan on or before the due date by paying just the fee, or interest.
Some lenders will allow you to renew your loan for a set period of time, whereby you only pay the interest when the loan comes due until you are able to pay the full amount. Other lenders have a specified number of times you can renew the loan before the full amount must be paid. Some lenders may also allow you to gradually repay the loan, so each payday you will be paying the interest due, plus a portion of the original loan amount until the entire loan has been repaid.
Who can use Payday Loans?
Anyone who meets the basic eligibility requirements can apply. People who never thought they would use a loan service sometimes find themselves in an emergency situation where they need money fast. The popularity of online lending is most attributable to the ease and convenience of being able to apply for a loan without having to leave one's home or office and take the time to fill out lengthy paper applications, along with the fact that borrowers usually receive the funds within 24 hours.
What Rate of Interest can I expect to pay?
Online lenders charge a fee for the money they loan you, which is usually referred to as interest. It's important to look at the rate of interest being charged, as these fees can range from $10 to $30 per $100 that you borrow. In addition, these fees are usually assessed every 14 days, which is the typical time frame for the loan.
Do Online Payday Loans Have Any Restrictions?
Online payday loans work the same way as regular payday loans. They carry no restrictions in that you are free to use the money however you wish. There are some online loans, however, that may be restricted; for example, such as the kind you may take out for the express purpose of buying a car. If you were to borrow money for that reason, the car would be considered as security, and the borrowed funds would need to be used strictly for that purpose.
Can I Take Out Multiple Online Payday Loans?
Not usually, although some lenders may approve multiple loans, especially after you have built up a solid relationship with the lender. It also depends on where you live as some states set a maximum amount of loans a borrower can have. Always make sure you thoroughly check the lender’s terms and conditions before signing for any loan.
Always Borrow Responsibly!