Loans for bad credit- You Want One Right?
In a perfect world, you would be able to have everything you want – your dream house, a new sports car and enough money in the bank to go on a vacation wherever you want. You would never have to worry about and stress over monthly bills.
However, life is not perfect, at least not for most people. Even though we all try to be in a stable financial situation, that is not always possible. No matter how well prepared you are, no matter how well you have organized your finances, you will never really be prepared for some unexpected events such as a hefty medical bill or a sudden breakdown of your car. In situations like these, you would most probably need a loan.
The lending industry has already evolved a lot in the last 10-15 years and today, you have a lot of borrowing options to get payday loans online. Depending on your credit score, however, those options may turn out to be quite limited.
Most traditional lending institutions do not grant loans to people with bad credit as they simply do not consider them as safe.
Being in a situation like this can make you feel trapped. This is where payday loans with bad credit come in. Payday loans are now considered as the go-to short-term loans in the industry. One of the main reasons they are so popular among borrowers is the fact that people can qualify for a payday loan even if their credit score is far from good. If you are one of those people, then bad credit payday loans are most likely what you are looking for.
What is a bad credit payday loan?
Payday loans, which are also called cash advances, are the type of financing that people can get immediately and are usually available for an amount of no more than $500. The loan must be repaid within the borrower’s next payday. Normally, a payday loan will have a term of two weeks or earlier. Any longer than that then the can be called installment loans.
Every state in the United States has established its own laws and regulations with regards to payday loans, so every payday loan may have different terms and conditions that will depend on the state you are currently living in. When it comes to short-term loans, payday loans are the most sought after. They are generally loved by the people who use them via direct payday lenders and hated by the traditional lending institutions.
There are many reasons why so many people find them useful. They are very fast and flexible, and it is not a requirement to have a good credit to qualify for a loan. While most conventional lending institutions require you to have a stellar credit score to grant you a loan, payday loan lending companies do not care about it. There are many payday loan companies that give out loans with almost no credit check at all or just a small casual check.
What they are interested in is whether you are able to repay the loan on time. If you have a good source of monthly income, you will be able to get your hands on an instant payday loan without any problems. Since the requirements are not that strict, you can expect payday loans to have a high annual percentage rate and fees.
This is mainly because they are short-term loans and also the fact that by accepting applications from borrowers with bad credit history, payday loan lending companies are taking a risk with every loan they grant. Another thing that differentiates payday loans from most traditional loan types is that when you apply for a payday loan, you get a very fast response to your application.
How do bad credit payday loans work?
If you are thinking of applying for a bad credit payday loan, you will first need to find a legal lending company. Since the internet took over, the number of loan lending companies has grown tremendously. There are many illegal companies out there, so it is important to do your research before you commit to one.
With payday loans, there are two options available when applying for your loan. You can find a lender’s on-ground store near your home or office to submit your application, or you can go to the lender’s online store. After you decide on how you are going to apply for your loan, you have to complete the application process.
Unlike traditional lending institutions where you have to go through a long application process which can easily take weeks to complete, with payday loans, your application process will be over as soon as within minutes.
After that, expect to get a response on the very same day you sent the application. And if approved, all that is left is for you is to get your money. You will have the money transferred into your account in as early as a few hours. If you decided to apply online, your money will likely be transferred after one business day. The required documentation for applying payday loans is rather basic and you will most likely have it with you already.
Who qualifies for a bad credit payday loan?
Compared to traditional loans, it seems like you do not need anything to qualify for a bad credit payday loan. However, there are still some standard qualifications that need to be met in order to qualify for a loan.
- You need to be considered a permanent resident of the state that you’re applying the loan from
- You should at least be 18 years of age
- You need to have a stable monthly income
- You should have a steady source of income as that shows that you are capable of repaying your loan on time
The application process itself also requires some basic information like:
- Your social security number, birth date, and your full name
- Your home address and phone number
- A valid form of identification
Bad credit payday loans advantages
Payday loans are claimed to be very risky for the borrowers. There are also benefits that come with them. Here are some of those benefits:
Payday loans are very fast
When you are dealing with an emergency, the most important thing for you is time. While traditional lending institutions will have you waiting for days and weeks to get your money, payday loan lending companies are ready to meet your needs within a few hours. That lets you pay off your emergency expenses and regain your financial stability.
Multiple application options
To apply for a payday loan, you can visit a lender’s physical store or submit your application online. While the chance of finding an on-ground lender’s store near your workplace or home is pretty big, the option to go through the whole application process online and get your money without having to leave the comfort of your living room is quite appealing.
Spend the money on anything you want
Traditional lending institutions like banks tend to set a number of limitations for you when taking out a loan.
The way you can spend the money is one of those limitations. When taking out a loan from a bank, you must state specifically how you are going to spend the loan money even before you have been approved for it. When taking out a payday loan, payday loan lending companies have no interest in what you plan to do with your money as long as it is not something illegal.
They only care about the loan being paid back on schedule. As long as you are able to do that, you can spend it on whatever you want. Fix your broken car, pay your electricity bill or medical bill, it is all up to you.
Having bad credit is all right
You should know by now that when taking out a payday loan, having a good or bad credit score is irrelevant. Building up a good credit score is something you should aim for, but don’t let your bad score stop you from getting the financial help you need.