--------------------------------------------------------------- Summary Called either a payday
loan, paycheck advance or cash advance these
usually involve a short-term loan that is
against your next paycheck. Typically the
cash loan is between $500 to $1,500 and has
a very short duration of 2 - 4 weeks. Many
of the lenders that offer paycheck loans will
do so without a credit check against the consumer.
These quick and "easy" loans do
come with a price though! They tend to have
a very high interest rate.
More
Information
A payday advance is considered unsecured debt.
As mentioned above a consumer gets a short-term
loan of $500 - $1,500. Most often consumers
go the cash advance route to help make timely
or late payments on their bills or credit
payments. The steps to obtain a paycheck advance
are faily simple.
1) The consumer either
goes in person to one of the many, many payday
loan outlets or finds a cash
advance lender online.
2) The consumer is presented with a usually
streamlined form that includes a credit agreement
and transaction terms.
3) If in person the consumer writes a personal
check for the advance amount plus a fee. If
online the consumer may be asked for his/her
banking account information.
4) The payday lender then provides the cash
loan, minus the advance fee.
Special
Caution
Customers should be cautious when obtaining
payday loans. Paycheck advances and cash advances
should not be used as a long-term solution.
If you're continually very tight on your budget
you may find it increasingly difficult to
catch up as you keep "borrowing"
from your next paycheck. This can create a
painful cycle where you'll need to get another
paycheck advance just to be even as you try
to catch up.
