The answer to the question, “Do payday loans help poor people or exploit them?” is simple. According to a survey done in 2016, “More than 50% of Americans have barely any savings.” Any emergency or problem, doesn’t matter how big or small, can financially ruin someone. This is where loans help. While you might be looking to go to a bank and get a loan, exploring your options is the better move. Payday loans for example are a better and easier way to get money quickly.
These loans are usually given out instantly and are known as short-term cash advances. Since Americans are used to living on their paychecks, they usually have the time and resources to save money for future purposes. But tough luck can strike anytime, people get indebted to their bills for years and end up being tied to commitments they can’t cash out on. The thing that usually scares off interested parties in payday loans is the higher interest rates that come with them. A $1,000 loan to turn into a $4,000 loan within a year. The interest rate applied on the borrower’s credit card can hover from 12 to 20 percent.
Being short on money and far away from your next paycheck can be a devastating experience. You’ll be forced to compromise on things you wouldn’t normally compromise on, which can lead to many issues with mental and physical health. Considering a payday loan means you’ll be borrowing from your own future salary instead of a third-party. This makes it a safer and better alternative to getting personal loans from banks.
How Can I Be Eligible For A Payday Loan?
A payday loan is based on the income of the individual in question. Being dependant on the income, the initial fees for the funding source and the amount of money provided are decided sometimes amounting to the loan being up to $1,000. After answering some questions the funding source will be asking you, your answers and personal information will be reviewed and upon that review, your eligibility will be decided. Although in most cases, every tax-paying American citizen is eligible for a payday loan with the exception of those in major debt who might give trouble to the company later.
Being a risky option, payday loans can be extremely difficult to pay back while you’re trying to recover from an injury or if you’re going through something personal. Since most people are living paycheck to check, they might get caught lacking and fail to pay back the loan. Since the interest rate is usually higher than loans you could get at the bank, payday loans are only suggested to those who are in dire need of money and don’t have much time to spare.
It’s extremely important to know if you’re going to be able to pay back the loan soon and won’t build up more and more interest on the loan. The world of payday loans was made much easier by the accessibility of the internet. An online payday loan is an option you previously wouldn’t have thought you have, but luckily you do. We urge you to choose a state-licensed direct lender so your personal information is kept secure and your loan is provided to you as fast as possible.