What to Know About Payday Loans?
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Many Canadians know when they need fast cash, they can rely on payday loans to help them make ends meet until their next cheque. When you need funds fast and have tried other options, payday loans are always available, but it is advised that they are only used as a last resort because of the high interest rates. While they can provide you with temporary relief, you should know what you’re getting into when you choose to use a payday loan.
One of the biggest challenges that some face is when they are in desperate need of cash, they might be willing to agree to anything. Some lenders that are less scrupulous know this and try to take advantage of a borrower’s predicament. Which is why you need to read before you sign, but more on this below.
Are Payday Loans a Good Idea?
For many, definitely not. But for others, yes. There are some people that do not have options like banks or credit unions to go to. They don’t have an emergency fund, and when unexpected expenses come up, their options are limited. While it is probably best to with another option, but if you don’t have any, payday loans can provide a short term solution.
Fast Cash from e-Transfer Loans
One of the fastest ways to get cash from an online payday loan is when they provide an e-transfer. If your loan request is approved, the funds can arrive in your account quickly.
Even with bad credit or low income e-transfer payday loans can be an option available to many when you need fast cash. If you’re employed, 18 or older with an active checking account, you can apply for a fast payday loan 24/7 online. With near instant approval, the entire process is quick and easy in Canada.
Finding a Guaranteed Payday
Sometimes people that are looking for loans online will come across all kinds of things that can sound too good to be true. This can be when some lenders will say just about anything and everything to attract your business.
One example is guaranteed payday loans no matter what Canada that some people will look for when in need of fast cash and hoping that some kind of guaranteed approval exists.
What About Payday Loan Alternatives?
A payday loan is really for people that have poor or bad credit and can’t get a loan through the banks or credit unions because of this. They are simply considered too much risk by the banks, and they’re not willing to let some borrow.
But if your overall risk doesn’t look to be too bad, sometimes online lenders will offer you what is called an installment loan, which is very similar to a personal loan. While these are also high interest, they’re a better option than payday loans, which are due in full on your next payday. With installment loans, you are provided the opportunity to make multiple payments. This can also be a lot easier on your budget than repaying a lump sum all at once.
While payday loans are a high interest short term loan, when used responsibly they can be a great option when alternatives like asking friends or family for financial help or pawning something is not a quick cash option. Of course trying the bank or credit union would be advised, or even a cash advance from a card. But it’s assumed these would have been used if they were in fact options.
As always, smart borrowing also means to read the terms of your loan agreement before signing as well, so that you know what your payments will be, when they occur, and other important details and conditions about your loan. Without reading ahead of time, you can later learn the hard way of things like additional fees, or even penalties within your loan agreement. It’s strongly advised that you take the time to read through it before signing and be aware of any and all particulars that you would be agreeing to.
You should also only borrow what you will be capable of paying back on your next payday. Otherwise, what happens to many is they find that they need to take out another loan to pay off the first, and it becomes a debt cycle that can be expensive.
While some studies say as many as half of Canadians could not cover an unexpected expense of $400, one thing you can do starting now is to put $10-20 away each check, to build up an emergency savings. Obviously, the more you put aside the sooner you might get to the point where you have saved something substantial. You might consider what you could do without temporarily, like a subscription service or something, to help you reach your goals faster. Who know, your future self might just thank you should an emergency happen later where you could use fast funds again.