Payday loans – a boon or a bane?
The Federal Reserve today estimates that around 47 percent of people are those that are not geared for any kind of financial and immediate emergencies.” This statistics is enough to put the chills down your spine. In plain simple words it means that half of the nation’s population is a case of hand to mouth. No, it is not an exaggeration to say that these people are those that are living from paycheck to paycheck.
Incidentally, these are also the people who have no savings whatsoever in their credit. God forbid, tomorrow, if there is any emergency, these are the people who will be worst affected and to think that it is half the population is enough to put the government agencies into a spin.
When you have hard time hitting you is also the time most of the calamities whether personal or otherwise will befall. Finance gurus across the world try to hammer the point home that there is nothing better than saving a part of your income however small it may be. The habit of saving money is no doubt one of the most extolled one.
Obviously, because it can save you a lot of embarrassment in your life!
This is true. If you love our life and love to live it in a dignified manner, you must at all times ensure that you have a decent saving in your account to cover any kind of emergency that can pop up unexpectedly.
However, say that you have saved but still it is not enough for you to cover your emergency?
The answer looks obvious. Maybe apply for a loan!
But you are disillusioned by the kind of paperwork and the procrastination that can take place when you have to apply for a loan and the time you wait for the approval by the lending agencies!
Well, if it’s a small amount, you may opt for a payday loan. If you have been struggling with expenses lately and you are still in the middle of the month then we would recommend that you look to borrow How to make sure your payday loan is legit | finder.com .
What is a payday loan?
A loan as well as payday loans is a short term loan that generally caters to people who want smaller amounts of money and those that are struggling to meet the ends during the month and before the paycheck arrives.
The benefit of the payday loan:
The beauty of the payday loan is that it is easy to apply and the easiest to get approved. Most of the lending institutions that process and approve traditional long term loans may also approve these including quick loans.
The loans can be even acquired online!
Some private lenders and institutions that approve such loans also approve and sanction online payday loans. This could not help but open world of convenience to people who do not have the time nor the aptitude to go physically to the bank or such institutions and stand in queues to get their own loans approved.
A click and the money will be credited in to the account!
Thanks to the immense strides made in the field of technology, it is easy today to get a payday loan approved from any place that you are at the click of a button. Amazing! The pitfalls of a payday loan: While it is convenient and easy and quick and you can get the loan within a matter of minimum of fifteen minutes from the time of applying, there is some caution that you will need to exercise in order that you do not borrow payday loans unless there is an actual need or an emergency.
This is simply because when you compare the rate of interest on them with the traditional loans that are available in the market, you will realize that the interest charged on a payday loan is excessively high. This of course includes the premium because these loans are easily approvable and do not require the stringent checks on your credit score either.
Things may be changing:
A trend is seen where people are nowadays recklessly borrowing payday loans and not paying up in time which has the high likelihood of affecting the person’s credit scores. Precisely for such reason, the consumer forum of certain countries have recommended that the lenders do a preliminary albeit not too stringent background check to see if the borrower will indeed be in a position for early or on time closure of his payday loan.