Payday Loans

Does Online Cash Advance Make A Great Option For People With Bad Credit?

If you have a bad credit score, it will be very difficult for you to qualify for a conventional loan program. Even if you do qualify for one, the process will take time and will require you to go through complex paperwork. That is the reason why many people look at online cash advance programs as the perfect solution when it comes to borrowing instant money to meet an unexpected, temporary financial emergency. These programs are packed with features that look very attractive, such as easy qualifying criteria, simple application process, no paperwork, and fast approval. But, there are a few facts that you must take into your careful consideration in order to make an informed decision whether an Internet payday loans (which is just another name for these programs) make the right choice for you, especially if you have bad credit. Following is a brief rundown on it.

It Requires You To Pay Back Within A Couple Of Months

If you are considering borrowing an online cash advance, the first thing you must keep in mind is that the repayment period is usually very short. You do not have much time to arrange the required fund to ensure timely repayment. The lenders usually ask you to submit a postdated check at the time of approval of loan. They send this check for collection on the next payday, when you get your salary credit into your checking bank account. If you earn a hand-to-mouth salary (which is usually the situation in most cases) and have to meet other major financial obligations, you may not have sufficient amount of fund left when the check is submitted by your payday lender. When the check bounces, the horror begins.

The Debts Multiply Very Fast

When you miss the due date on an online cash advance, you actually push yourself into a much deeper problem. The nastiest thing about payday loans is that the debt caused by them multiplies itself very fast. For example, when the check bounces, you are charged hefty amount of penalty charges. Besides that, for every single day of delay, you are charged interest at the same high rate. As you very well know that the interest rate on these loans is extremely high (around 300%-600%), you can calculate on your own how heavily a one month delay will cost you. Within just one month of delay, your overall outstanding debt balance can grow to double or even triple of the amount you borrow initially.

Last, but not the least, since you already have bad credit, getting out of the debt caused by online cash advance programs will not be an easy task for you. Though there are certain payday debt solution programs available out there, but you will have a tough time qualifying for the same because of your bad credit score. Therefore, you are advised to be very careful before you sign up for these predatory payday lending programs. Go for it only if there are no better alternatives available and only if you are sure that you can afford it and repay it in a timely manner (on the set due date without any delay).

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