Cash Pay Day Loans

By: EconomyWatch Content   Date: 25 November 2009

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Cash pay day loans are short-term, unsecured loans usually of $500 or less. If you are in dire need of short-term cash, you can opt for a cash pay day loan, and repay it from your next paycheck. The APR for such an arrangement is usually on the higher side. Typically, you write a postdated check for the loan amount plus the lending fee in favor of the lender. You then receive the loan. On payday, you have a choice to either pay the loan along with the finance charges or extend the loan by paying only the finance charges, and writing a new check.

The most effective and convenient way to find the best cash pay day loan is to conduct a thorough research online. You can compare various APRs, finance charges, loan fees, duration of loan and other terms and conditions. You should borrow just enough to be able to repay your lender on the next payday. 

Advantages of Cash Pay Day Loans

The main advantages are:

·        Your credit rating isn’t a major issue in this case unless you’ve applied for bankruptcy.

·        The process is easy and you’ll usually receive an electronic deposit in your checking account within one business day.

·        There are no lengthy application procedures or delays in receiving the funds unlike in the case of traditional loans offered by banks.

·        If at any point of time you want to cancel the loan, the loan amount gets withdrawn from your account, and you have no additional obligations.

·        You can also repay your loan amount before the due date. You'll only be charged interest for the days the loan was outstanding.

·        You also have the option of extending your loan by paying the interest owed on the original amount. 

Disadvantages of Cash Pay Day Loans

The main disadvantages are:

·        If you opt for a pay day loan, you could end up spending more to pay it back than what you had originally anticipated.

·        The interest rates are very high. In many cases, the rate is $25 for every $100 you wish to borrow.

·        The period to repay the loan along with the interest is short, which may create a lot of pressure on you.


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