A payday loan is unlike any other
type of personal loan you could take out. When you go to your bank to ask for a
loan, they check your credit and put dissect your finances to see if you are
qualified. When you walk into a payday loan service, you are not subjected to a
credit check and the application process is extremely light and fast. When you
take a loan from the bank, you can pay it back slowly over time or may have a
long term due date. When you take a loan from a payday service, you typically
have to pay all of the money back plus interest within one or two payday
cycles.
Due to higher interest rates and
faster required pay back, these loans are typically reserved for those who have
no other options. A payday loan may not have ideal terms, but the terms are
there when you do not have any other option and need money fast. In fact, this
is the only type of personal loan that many people can be approved for today.
Yet, you should make sure this is
truly your last possible resort before locking yourself into a payday loan. If
you really need it, this is the personal loan that could save you from very bad
things happening in your life. You just do not want to go into this type of
loan if you have other options.
Ask and You May Receive
Before you commit to a payday loan,
make sure there is no one in your personal life who could give you a loan with
better terms. It is always a matter of pride when you have to go to someone and
ask for money, but if it could help you out of a bad situation it is worth
asking. You never know who may be willing to help you out if they know you are
in need.
If you feel bad asking for money
outright, consider setting up a personal loan with someone you trust. Offer
them a small amount of interest on the money and sign a paper guaranteeing you
will return the money on a certain date. If the interest is lower than you
would pay for your payday loan, then it could be preferable to the loan with a
service.
Question Your Motives
Before taking out a payday loan, you
should also question your motives for asking for this loan. Determine exactly
what you will pay off with the loan. Then question whether it is worth the
amount you will end up repaying for your personal loan. Make yourself justify
this expense so you know if this is a responsible financial move, or not.
If you are in a serious situation,
then this decision will be easy to make. If you just want to buy something
trivial, then you could very easily go without the personal loan and be better
off in the near future.
In many cases, a payday loan can be
just what you need. You just want to make sure it is in fact your only way to
get this money, and that the money is worth spending in this manner.
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