Tips to manage your payday loan responsibly
A payday loan is a quick fix for an unplanned monetary obligation that eases the cash crunch in-between paychecks. The requirement could be anything – personal, business, vacation, family health, house repair, vehicle servicing, etc. Ok but, would it not be more sensible to borrow from family and close friends? Wouldn’t asking the employer for an advance out of the next paycheck help?
Yes indeed. However, there may be times when they may not be in a position to bail us out. Short term loans involving small dollar amounts come in very handy.
Still, how are we going to find a lender? Who would be willing to give us an instant loan? What information would they ask? How can we trust them?
Companies like Open Loans Direct strive to help you find the best loan provider from among their network of licensed and reputed lenders. You can apply for a loan from your home, office, or while traveling by accessing their secure website from a desktop, laptop, or mobile phone. Their services are free of cost. They use data encryption protection technology to safeguard the information you share with them.
Before applying for a loan, understand the following:
- Licensed Loan Providers. Be wary of the illegal activities of corrupt money lenders who abuse and threaten their borrowers. They manipulate their clientele by phishing and collecting sensitive information through calls and emails. Avoid answering calls from unknown numbers and do not open emails from new email ids.
- Rules and Regulations. All states do not follow a uniform rule for payday lending. You have to ensure if,
- -your state encourages payday loans.
- -there is a restriction on the maximum loan amount.
- -there is an interest rate cap on the Annual Percentage Rate (APR).
- -a loan-rollover facility is available.
- -borrowers are safe from criminal activity
- Debt Management. Though the amount involved is small ($100-$1000), they attract high-interest rates (as high as 300% in some states). Borrowers find it tough to pay off the loan amount. They tend to borrow again to pay off the previous loan and avoid the atrociously high rollover fees. It sabotages their credit history/score. You should adopt proper planning and budgeting methods to ensure responsible debt management and higher creditworthiness.
Now, you are aware of the lending terms and the associated rules and regulations of your state, get ready to apply for a loan.
The online application process takes approximately 15 – 60 minutes. While some lenders may require specific pieces of information, the basic requirements of all lenders are:
- Proof of age. (Minimum age requirement is 18 years).
- Proof of identity. (Social security number)
- Address proof.
- Proof of employment and income.
- Verifiable bank information.
The loan processing procedure evaluates your credit score and credit history to determine if you are an eligible borrower. On approval, it takes about one to two business days for the loan amount to land in your account.
Voila, you are all set.