Useful Tips On Emergency Loans

The latest financial security index survey by Bank rate indicates that only 39% of Americans could cover life’s unexpected emergencies with their savings. With all sorts of calamities popping up when you least expect, it is important to have some savings set aside for rainy days.

Life is unpredictable, and sometimes even with a carefully planned budget things can get out of hand leaving you financially crippled.  I

f you do not have any savings stacked up in an emergency fund, credit card debt, your only way out would be a short-term emergency loan.

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So what are emergency cash loans?

Emergency or payday loans are short-term loan facilities with repayment periods of between 2 weeks – 2 years. These loans are available to individuals who are stuck and need cash real fast to sort out a nagging problem.

You should not use these loans as a long-term financial solution. Their interest rates and APR are usually high making them very expensive.

Features of loans for emergency

Since these loans are supposed to give you quick access to the funds you need in a crisis, they should:

  • Have a quick turnaround time – the faster you get your loan approved and funds credited to your bank account, the better. Most lenders have simplified the loan application process and the approval time is usually shorter. If your request is approved, you can have the cash on the same day or as soon as the next business day.
  •    Administration fees and interest rates – the amount charged as the interest rate and loan fees vary from lender to lender. The state laws, however, have a regulation in place to curb payday lenders from exploiting vulnerable borrowers. These amounts differ from state to state but in most cases, lenders charge an interest rate of 10% on every $100 borrowed.
  • The loan amount – most states allow borrowers to borrow from $500 – $1000. The amount a lender will lend you, however, depends on your capacity to payback. And they will use your salary or cash inflow to gauge that.

Benefits of emergency cash loans

No credit checks

You don’t need to worry about poor credit score history. Most lenders don’t perform credit checks and are only interested in your capacity to payback. Borrowers with bad credit scores can also apply for a loan and get approved.

No restrictions on how you use the loan

Payday lenders don not ask or care how you intend to use the funds.

A large pool of direct lenders to choose from

the loan market is flooded with several lenders offering different terms. It is important to do your research and settle for affordable rates.

Instant access to funds

Unlike traditional banks that will perform lengthy credit score checks and take forever to approve your loan request, most payday lenders have an easy application process and a fast loan approval time.

No security needed

You do not need to offer your valuables as collateral to get a loan. Your post-dated check is security enough.

It can save you from the embarrassment or legal action of bounced checks – if you have some debts to payout through a direct debit process, and you don’t have any money in your account, emergency loans for bad credit can help you out.

Drawbacks

They are expensive – these loans have a high-interest rate as compared to other loan products. It is, therefore, important to use them only for short-term financial problems.

Short repayment term – you will be expected to pay back the full loan amount plus all the associated fees by your next paycheck. This, in most cases, leads to borrowers rolling over their loans or borrowing more to get by.

Emergency Loans

What you need to know before applying an emergency loan

Emergency cash loans are a great solution to your short-term financial crisis, but they could lead you into more debt if you don’t approach them with caution. These are some of the things you need to consider before applying for emergency payday loans:

  • Be sure you are able to pay back the loan before you even apply for it – late repayments could lead to additional charges and this could mess your finances.
  • Compare different lenders before settling for any. You should use a lender with affordable rates. Also, go for lenders who can flex your repayment schedule if you are stuck.
  • Before signing any loan agreement form, make sure you read and understand the terms and conditions. Ask questions and append your signature only when you understand their loan program. Check on all the hidden costs, administration fees, and repayment schedule.

At paydaynow.net we understand how frustrating it is to have a financial emergency without cash. We make it easy for you to get cash instantly. By filling our loan application form online, you get connected to a pool of direct lenders who will review your request and approve it fast.

Once your loan is approved, you’ll get directed to the lender’s page where after reading the terms and conditions, you’ll sign the agreement form after which the funds will be disbursed to your bank account on the same business day.

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