Payday loans exist today because they allow average people to borrow money without meeting some of the stringent requirements of larger lending institutions. Payday loans are really cash advances against future income. They are short-term loans that have helped many people to get through difficult financial times. These loans are not for everyone or for every situation. If your situation meets a few criteria, then a payday loan is likely the right choice for you.
You Need Money Quickly
One of the benefits of payday loans is that they are fast. Some people can receive money from the loan in as little as 24 to 48 hours. This is because the eligibility requirements are straightforward and simple. If you need money quickly, then a payday loan is one of the only valid options available. You can get the money fast in order to pay for emergency expenses, prevent repossession of a vehicle or stop an eviction.
You Have a Stable Income
Taking out a payday loan means you are borrowing against your next paycheck. You need to have a stable income in order to qualify for a payday loan. You usually must have held the same job for six months or more. The amount of your income needs to be relatively consistent on a monthly basis. You should be certain that your income is stable and will last for several months after the loan is repaid just to be safe. This will make repaying the loan much easier.
Your Financial Problems Are Temporary
Payday loans are intended to be for emergencies or short-term financial needs. They are not meant to make up for regular deficits due to low income or bills that are too high. A payday loan is often a good choice if your financial problems are temporary. This could mean your paycheck is late or you have a one-time expense you need to cover right away. You should not use payday loans as supplemental income every month.
You Need a Relatively Small Amount
The amount that you can borrow through a payday loan is limited by law in many areas. This limit could be a set dollar amount or a percentage of your earnings. You usually cannot get very large payday loans. Most are limited to a few hundred dollars. Payday loans could be the right solution for your financial problems if you need just a relatively small amount.