If you’re in a tough financial situation, you may be looking for a simple and quick solution. Fortunately, payday loans help all kinds of people receive immediate funds for paying their bills, buying groceries, and making short-term purchases.
A payday loan is a type of loan that is set to be repaid when your next payment arrives. By taking out a payday loan, you’re basically agreeing to pay the money back when you receive your paycheck. In this article, we’ll explain five advantages of using a payday loan in a financial emergency.
1. Easy to Access
Payday loans are widely accessible to all kinds of people. As long as you have verifiable income, you can apply for a payday loan. In addition, payday loan centers are located in shopping centers and municipal areas.
This means you can easily take out a payday loan at a location near you. You can even apply for a payday loan online. Loan providers like My Canada Payday provide online payday loans in as little as 15 minutes.
2. Fewer Requirements Than Other Loans
Payday loans are known as convenient, quick-cash alternatives for people dealing with a financial emergency. Unlike other loan types, many payday loan providers simply want collateral if you default on the loan.
This collateral is your job, as the loan provider will request documents such as pay stubs to verify your employment. Borrowers with poor credit histories and low incomes can potentially secure payday loans, while not being eligible for other loan types.
3. Get Approved with Bad Credit
If you have bad credit, you can still apply for a payday loan with a high possibility of approval. This is especially true if you have stable employment and can verify your place of employment on the loan application. Payday lenders are more concerned about whether the borrower can repay the loan within a specific period than their past financial history.
4. It’s an Unsecured Loan
Payday lenders usually don’t request physical collateral, such as vehicles, homes, or other valuables, other than your job. This is because payday loans are unsecured, meaning they don’t require collateral. Due to this, payday loans will likely carry higher interest rates to give the lender an insurance policy in case you default.
5. You’ll Receive a 14-Day Cooling-Off Period
Per the Consumer Credit Act 1974, borrowers can cancel an agreement with their lender within 14 days if they change their mind. If you cancel your loan, you’ll have to pay the full amount back with interest. However, the lender will have to refund you the fees you’ve paid to secure the loan.
Endnote
Overall, there are several benefits to applying for a payday loan. However, a payday loan can put you into short or long-term debt. Before you take this approach, it’s best to weigh your pros and cons. Doing so will help you make an informed decision and avoid buyer’s remorse in the future.
Tags:
