A PayDay Loan is a short, small-time unsecured loan at very high interest rates. This is basically a cash advance for money that is not in the bank or savings account, but you have to pay back on your next paycheck. These loans are used by those who can’t make their minimum payments on time and can’t qualify for a payday advance. The money can be used for any number of reasons. One may need extra money to pay bills, or another person may need money for emergency situations.
There are several companies that offer these services. Many are online and some are brick and mortar companies. The difference is in the amount of the loan, and how long the loan is for. A payday loan is also known as a cash advance, check advance, and paycheck advance. This type of loan may come with extremely high interest rates. This is because they are not backed by anything other than the person’s job and income. This can cause the interest rates to quickly spiral out of control and may even lead to a default.
When a borrower obtains a payday loan, this is called an advance and it can be paid off within 30 days. There is usually a fee charged for this service. The fee may be a percentage of the amount you borrow, or the full amount, depending on the company you go through. Make sure to research each company that offers a payday loan, and then make the best decision for you.