When emergencies occur in your life, it does not matter whether you have the money to deal with them or not. The problems must be dealt with. This is something that can be quite difficult for you if you are short of money and the next paycheck is weeks away. Payday loans come in handy then. These loans are given to people who need money quickly and have no way of getting a traditional loan for one reason or another. The security required for this loan is usually evidence of a steady source of income that indicates that you can pay off your debts fully during the period you have agreed on with your payday loan lender.
Pros of Payday loans
The advantages of getting money via a payday loan are quite significant. One of those is the fact that your credit history will not be held against you no matter how negative it is. This is because all that is required is that you have a steady paycheck that enables you to pay off your loans.
Another benefit of a payday loan is the fact that the lender is more available than traditional lending institutions like banks. Most of the payday loan companies are usually available even on bank holidays thus enabling you access money you need desperately.
Unlike other types of loans given by traditional lending institutions, loans of the payday variety take a very short time to process. You can even make your application online via the official website then wait for an hour or less for feedback. As long as you show the ability to pay off your debts through your paycheck, the money will be yours in no time. You do not even have to worry about red tape or investigations into your financial history. This is one of the reasons as to why a payday loan is very attractive to most people.
Payday loan companies usually wire the money they have given you to your bank account. This is a more secure way of doing things that ensures that you are not robbed of money on your way home. With your permission, your debt can be paid the same way with money automatically deducted from your account until everything is paid off. It is a much better way to prevent you from not repaying your debts and getting into trouble with your lenders.
The cons of Payday loans
One of the major disadvantages of payday loans is the fact that you will only have access to a limited amount of money. In fact, the law states that the maximum you can borrow using this option is £1000 and not a penny more. This means that you have to get additional funds elsewhere if you need to pay more for your emergency needs.
Another disadvantage of getting a payday loan is the fact that it carries a relatively high interest rate and low repayment period. This is usually done to protect the lenders from the risks of doing business without adequate security.