5 Things You Need To Know About Cash Advances

By Author: Martin Sumner
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Wage advance loans are a popular if costly form of borrowing, useful for covering short term gaps in your budget. Plenty of people have by now discovered them, but as with any kind of financial service it's important to know what you're getting yourself into before you committ yourself. What are some faqs you need to know the answers to in advance of looking for one?

1 - How Much Cash Can Be Borrowed?

Typically, wage advance loans are for low figures in the region of between $100 and $1000. Of course, different loaners will offer different loan sizes, but if you feel the need to borrow anything much more than approximately $1000 then you're not really working with cash advance loans as they're meant to be employed, and you should if at all possible search for an alternative option if you want to avert huge charges.

2 - How Much Time Can You Take To Settle?

This kind of finance isn't expected to fund long term borrowing - it's far too expensive for that. Preferably, a payday advance really should be employed to deal with a financial shortfall lasting ...
... only a week or two until your next salary comes in. Because of this, you will only be able to borrow over a maximum period of one month, or less in some cases.

3 - How Much Do Online Payday Loans Cost?

Here's the fundamental thing with these loans - they're extremely expensive. Expect a one-time fee of up to a quarter of what you borrow. When translated into an Annual Percentage Rate figure, this can show some breathtaking figures of thousands of per cent or more. This is probably misleading, as you won't be borrowing over a 12 month period (which is what APR measures), but nevertheless they're very high-priced indeed.

4 - What If You Can't Afford To Pay Off The Loan The Following Month?

If you can't afford to pay off the borrowed funds when your wage comes in, most lenders will allow you to renew the loan, extending it for another few weeks. A new set of fees will be charged. This can get very expensive very quickly, so most providers will only permit you to renew once or twice before requiring that you start to scale back the amount you borrow to wean you off your need for the loan.

5 - What Are The Approval Criteria?

The beauty of cash advance loans is that, however overpriced, more or less anyone who is employed will have their application approved. Credit score isn't considered, and quite a few issuers don't even carry out a credit score. As long as you have a recurring source of income and also an applicable account with a bank, you're virtually guaranteed to be accepted.

About the author: Martin writes for http://www.ukpayday.co.uk/ where UK residents of all statuses and credit ratings can apply for a payday loan.