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Payday Loan - Storefront versus Online Lenders

A payday loan can be secured through a physical lender or an online company. The first option is a storefront or brick and mortar lender with a physical location where the borrower would go to complete an application and get the money. The second option is through a business that handles loans only via the Internet. Both lenders work off the same concept but have unique advantages and disadvantages.

Starting with the storefront lender for a payday loan, many people feel more comfortable and confident when they can stand in front of a real person to conduct business. Additionally, many people needing a payday loan find it easier to walk into a physical business to complete the loan process the old-fashioned way. With so many storefront lenders now available, people in cities of all sizes would likely have multiple choices.

Regarding the payday loan through the Internet, the processing is often faster and when a reputable lender is used, the transaction is 100% safe and secure. Another benefit is that some people feel funny about standing in line with other people that need a payday loan, appreciating the convenience and privacy that an online lender provides. The number of online lenders is greater than storefront lenders, allowing the individual the opportunity to shop around.

No matter the choice made by the individual for a payday loan, he or she should understand what this type of loan is and why it would be beneficial. Simply put, a payday loan is a short-term solution designed to help a person out financially until he or she receives the next paycheck. Therefore, loans such as these are established for anywhere from one to four weeks, depending on how often the individual is paid.

The amount that lenders offer with a payday loan varies, ranging from $100 to $2,500 but of course, interest rates and other fees would apply. While the interest rate tacked onto a payday loan is much higher than interest on a more traditional type of loan, considering that the money is received within 24 hours and that no credit report is required, this has proven to be a great solution to help certain people and situations.

Most everyone, no matter the occupation or level of income is faced with unexpected expenses at one point. This might involve a car that needs repairs, overdue bills, medical bill, and so on. If the expense arises in between paydays, some people have trouble coming up with the funds needed to resolve the financial crisis. In this case, a payday loan would be a fast solution allowing the problem to be resolved and the borrower to pay the loan off quickly.

With a payday loan, people are no longer in a position of writing a check they know is going to come back for insufficient funds, taking a prized piece of jewelry or family heirloom to the pawnshop, or dealing with overwhelming stress. Instead, the person needing quick money would simply need to provide proof of income and have a bank account in good standing to get a payday loan. The ease of this type of loan makes it a very popular choice.

While there are many advantages to taking out a payday loan, people need to remember that this is still a loan, which means the borrower has to be responsible. If the loan payments were not made on time and according to the terms and conditions, not only would the borrower have his or her checking account or paycheck garnished but also the lender would have no choice but to report negative action to the three credit bureaus. Therefore, people can use a payday loan and get out of a tough financial situation but they have to be responsible.

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