A Beginner’s Guide to Payday Loans: Everything You Need to Know

There are a lot of different things that you should know when it comes to getting a payday loan. This type of loan can be very useful if you have some type of important expense that you need to pay off quickly. The more you learn about payday loans, the more likely you will be to actually apply for one. Considering all of the misinformation that exists concerning these loans, it’s important that you know the truth about them before making a final decision either way.

Choosing a Lender

You will quickly discover that there are a lot of different lenders that offer payday loans, but you will not want to choose just any of them. It is important that you select a private lending company that is highly reputable and trustworthy so you can minimize your risk of getting into an endless cycle of debt. The more time you spend looking for the right lender, the better your chances are going to be of getting the money you need without experiencing any problems.

Applying for a Payday Loan

The application process for payday loans is very simple, so you shouldn’t experience any issues at all. All you need to do is go online to the lenders website and fill out the application form. This shouldn’t take more than ten or fifteen minutes, but you will need to have some information ready. With this sort of application you will need to submit details about how much money you make as well as your social security number, address, phone number, email address and other things. Once you have submitted your application, you just have to wait to hear back from the lender as to whether or not you have been approved.

The Contract

If you have been approved for a payday loan, you will first need to look over the contract you have been given to sign before putting your name down on it. Although you may sign the contract online, it is still legally binding and therefore it is crucial that you take the time to look over it carefully. In this contract you will be able to see all of the details of the loan, including what the interest rate is going to be and the exact date that you must pay back the money you borrow. When you actually read through the whole contract before signing, you can reduce your chances of being ripped off by an unscrupulous lender.

Getting Your Money

After you have signed and agreed to the terms and conditions of the loan, you will be able to receive your money. Most people who are approved for a payday loan receive their funds within 24-48 hours. The funds from your loan will be electronically transferred into your checking account, so you won’t have to worry about waiting for a check in the mail or having to go somewhere to get it. This is one of the many reasons why payday loans are so convenient.

Paying Back the Loan

It is highly recommended that you set up repayment so that the money you borrowed is automatically taken out of your checking account when the pay back date rolls around. This will make paying back the loan a lot easier and more convenient for you. The last thing you want is to forget to pay your loan back on the date that is specified in the contract you signed with the lender.

Consequences of Late or Non-Payment

There are some pretty serious consequences associated with paying back your loan late or not at all. You will most likely be charged a late fee every single day your loan is past due, which can quickly add up. If you want to avoid getting stuck in a long cycle of debt to your lender, you will need to make sure that you know when your loan is due to be paid back so you don’t have this problem. Failing to pay back your loan altogether will result in your debt being sent to a debt collector, who will keep trying to reach you via calling/text/email to attempt to collect the money you owe. Those who do not pay their payday loan back will also have a negative mark on their credit report.

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