Is payday loan a money saver?

Posted by Deb | Guest Post | Friday 31 August 2012 1:05 pm

Quick loans or fast loans are small, short term loans that help borrowers with immediate cash.

Types of quick loans:

1. Payday LoansPayday loans are short-term loans intended to meet the immediate expenses until the next pay check comes. They are ideal for the expenses like medical bills, house rent, utility bills and groceries. The great advantage of payday loans is that it is easy to obtain and does not involve much paperwork. On the other hand, the downside is that these loans charge high interest rates, varying from one lender to another.

Now on a macro level, payday loans can be divided into seven different types.

• Low fee payday loans: These payday loans are loans that charge lesser interest rates as compared to the standard payday loans interests.
• No fax payday loans: These payday loans save the borrowers from filling out forms or faxing documents as a proof.
• Military payday loans: Military payday loans charge low rates of interest and are offered to military personnel.
• No credit check payday loans: This kind of payday loans perform no credit check and thus, offer the loan to all, irrespective of good credit or poor credit.
• Paperless payday loan: Paperless payday loans are approved and handled on the internet. Hence, no paper work involved.

2. Bridge Loans – Bridge loans are short term loans that cover an interval between two transactions. These loans are usually used for real estate transactions. For instance, if you have bought a new home and waiting for the old home to be sold so that you can pay for your new mortgage, then you have two options to be considered – 1) Home Equity Loan 2) Bridge loan.

3. Quick Business Loans – Quick business loans are loans that intend to help the businesses stay afloat. These loans are taken to fund a business until the cash flow is back in shape as it should be.

Are payday loans expensive?

Now the common concern is whether payday loans are expensive or not.

It is difficult to say whether payday loans are expensive or not. But by comparing the charges and costs of payday loans with unauthorized overdraft, it is found that small sums of payday loans (if the amount is less than £250) are cheaper than unauthorized overdraft. However, this story is far to be true with large sums of payday loans, in case the loan amount exceeds £300.

Here is the list of some of the determining factors whether payday loans will be cheaper than unauthorized overdraft.

• The charging policies of the bank or lender you choose.
• The amount of loan you obtain
• Charges involved with the specific payday lender.

To know more about it, visit

http://www.responsible-credit.org.uk/uimages/File/payday%20lending%20the%20UK%20october%202010%20final.pdf

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4 Comments »

  1. Comment by Jeff — September 1, 2012 @ 10:20 pm

    I dont think any type of super high interest rate loan is good for anyone, one is onyl opening themselves up to more risk if something bad happens….Plus normal people are not good at all with money
    Jeff recently posted..technorati shortcode post

  2. Comment by James Crollins — September 5, 2012 @ 1:15 pm

    I think it really just depends on your personal situation, advance loans can be really useful as long as you have the income to pay it back on time! Other wise steer clear!

  3. Comment by Roscoe from Roscoe — December 2, 2012 @ 2:06 pm

    Wow, this piece of writing is nice, my younger sister is analyzing these kinds of things, thus I
    am going to let know her.
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  4. Comment by Jess from pay day loans — December 10, 2013 @ 3:06 am

    Payday Loans With No Checking Account can be approved to you if you successfully meet following basic requirements:-.
    They are armed with legal expertise about the lending laws in your areas.
    Most lenders offer methods to lessen difficult scenarios such as a missed paycheck or financial
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