Making Payday Loans Work to Your Advantage

There is no question that times are harder now economically than they were ten, twenty, and even thirty years ago.

With the recent global recession affecting nations worldwide, everyone is feeling the pinch in their finances. This often leads one to consider taking out a “payday loan” from a payday loan vendor.

payday-loansWhat Are Payday Loans?

Payday loans like Loans are designed to cater to those who need money quick. This may be due to an upcoming mortgage payment, a car repair, or some other item that needs to be paid before the individual’s next pay cheque.

It’s fast, it’s easy, and it can be one of the most convenient ways to take care of one of the many little emergencies that life throws at us.

Short Term and High Interest

The number one way to use a payday loan to your advantage: To know you’re only going to need it for a short period of time. Consumers need to keep in mind that these loans are meant to be incredibly short term.

Go beyond a certain date, and you’ll find yourself paying high-interest rates on what originally was likely a smaller loan (anywhere between $200 and $1000).

Payday loans work out well for those who:

  1. a) Don’t lie on their application about how much they make and how much they need (this may not only result in charges of fraud being brought against you, but it will land you in over your head in debt repayment)
  2. b) Know that they can pay back the loaned amount in a short period of time

Money when You Need It Most

Haggling with a bank or other lending institution can be time-consuming, frustrating, or just downright painful.

Payday loans will have you in and out the door within 30 minutes. The payment is also typically deposited within the same 24-hour period you applied for the loan.

This type of loan is ideal for those who need money fast and who are going to use it to build their own capital.

For example, if you are starting a small business venture out of your basement and need $1000 to purchase inventory to make more money, this makes sense. The inventory will quickly pay for the payday loan and any interest you may have accrued in a short period of time.

Another example is having your car break down and needing a quick loan to repair it. If your vehicle is an essential part of your livelihood, then you will need it back up and running sooner than later so that you can continue to make a living.

Shop Around

A mistake that many make is they head to the first payday loan establishment that they see on the corner. Not all are the same, and some may have lower interest rates than others.

Do your research and make sure that you aren’t settling with the most expensive offer. You may be surprised just how fair payday loans can be depending on the time frame you expect to be able to pay the loan back.