In case of a financial emergency, applying for a payday loan is one of the easiest ways to raise cash to solve the problem. With the loan, you can comfortably pay for unexpected expenses as well as late bills before you get your salary. Here are 5 main benefits of a payday loan.
It is very easy to apply for a payday loan because all the application process is done online. Therefore, when applying, you don’t need to call your lender or book an appointment with a loan officer to get the loan. Instead, you can send your application from your office or your home and if or not you are successful, you will be notified in a day. To ease the application process further, there is minimal paperwork involved making it convenient for a lot of people who need money fast.
2.The loan has few requirements:
You don’t need a lot of documents when applying for the loan. The most important requirement to secure the loan is a stable source of income. Therefore, if your income is consistent and verifiable, your chances of getting the loan are very high. However, to be successful you need an active checking account and a permanent address to your home. No collateral is needed when applying for a payday loan. You just need to prove you can pay the loan on time even if you’ve got a bad credit score.
Most lenders approve payday loan applications in a day or two and process them within hours if provided necessary information. If you apply for a conventional loan, it takes several weeks to process and get a feedback whether or not you are successful. This may not be helpful if you have an emergency and this is where payday loans come to rescue.
4.You can qualify for a higher amount:
If you repay your loan within the agreed period of time, you can qualify for a higher amount depending on your loan requirements and your paycheck. Most lenders limit the amount of money they lend to new borrowers because they don’t know whether they are reliable or capable of paying the loan as agreed. In most cases, money lenders can only give you a loan that is within your salary range to develop your trust. However, if you pay your first loan on time, you can get a higher amount on your subsequent applications.
5.Protect your credit rating:
Unlike other types of loans, getting a payday loan can protect your credit thus helping you qualify for another loan in future. For instance, when you apply for an instalment loan, you are given a period of one or two years to fully repay the loan. Anything can happen within the two years e.g. lose your job and if you happen to default paying your loan, your credit score will be affected. You will also incur penalties and fines that will thus increase the total cost of your loan.
If you have got a financial emergency, consider applying for a payday loan because it is the quickest and the most convenient way of handling the emergency. However, you need to do a thorough research of the lender, terms of payment and interest rates to avoid paying a lot of money in the long run.