A payday loan is referred to as a short-term loan that can help you with fulfilling your instant cash requirements until your next paycheck. Many companies provide payday loans online on the same day deposit to take care of your emergency needs.
However, before applying for a payday loan, one must be fully aware of the amount to be received and the amount to be paid later. Depending on your location, you get a payday loan, either online or through a physical branch with a lender. Various states have various laws and regulations regarding payday loans based on the interest and fees charged. Some of the states even prohibit payday loans entirely.
Once your payday loan is approved, you may receive the amount by cash, cheque, or bank deposit. Then, you will need to pay back the amount with interest within 14 days or until your next paycheck.
Amount Borrowed as a Payday Loan
Payday Loans range between $50 to $1,000, based on your state’s guidelines regarding payday loans. For instance, in California and Montana maximum payday loan amount is $300 whereas, in Illinois and Idaho, the maximum payday loan amount is $1,000. Some states even have payday loan amount as 25% of the recipient’s monthly income. The costs linked with payday loans vary from state to state. It is set by state laws and ranges between $10 to $30 per $100 borrowed.
Repayment of a Payday Loan
You usually repay a payday loan within a single payment by your next paycheck. As different lenders have different repayment terms, make sure to ask the lender their particular due date before applying for a payday loan. You can pay off your debt through different options such as a postdated cheque while applying, a cheque on your next payday, online payment, or bank transfer.
Additionally, if the loan is not repaid on time, the lender can withdraw money from your bank account electronically.
Some payday lenders offer a renew or rollover feature if permitted by state law. According to this, if the loan due date is nearby, the lender may allow the old loan due amount to be rolled over to the new loan or renew the existing loan. With this, the borrower pays only the fees whereas the larger loan’s due date is extended. However, this also means piling up fees if the cycle is continued.
Companies providing payday loans online on the same day deposit feature are highly considered. They help you fulfill your emergency money requirement by providing a short-term loan, without checking your credit score. This is a great option for people who are in need of immediate money but have a bad credit score. One must be well aware of the payday loans’ terms before applying, as different states have different laws regarding payday loans. These laws are usually based on the maximum amount borrowed as a payday loan and the fees or interest charged on the loan amount.
Hence, before applying for an emergency payday loan, understand the agreement terms well, and also be aware of all the state laws and rules regarding the payday loan procedure.