Guaranteed Payday Cash Loan
A cash advance guaranteed payday loan differs from a bank loan in several ways, and is used to grant short-term financial needs rather than to finance long-term needs such as cars or houses. Generally, banks or financial institutions seem more picky than payday lenders, since they usually run a thorough credit check and often deny the application because they feel as though they’re taking on too much risk.
How Payday Lenders are Different from Banks
During times of recession, banks are sometimes labeled as the “bad guys” because they aren’t willing to lend. But then again, payday lender critics say that cash loan lenders are the “bad guys” because their fees are exorbitant compared to banks’ interest rates, and that they start a slippery slope to people who can’t afford those fees.
Advantages over Banks
Businesses that offer guaranteed payday loans usually don’t run credit checks, and they often tout that fact so much that they can tend to focus on those with bad credit. You can also receive guaranteed payday loans much faster than you can receive bank loans, and nowadays you can usually apply without having fax your information back and forth.
Generally, the money is deposited in the bank account or given within 24 hours, and sometimes much faster than that. This could be a big deal to someone who wants to avoid an overdraft fee from the bank for having pulled more money from a checking account that he or she has in there. An overdraft fee typically ranges at about $25, although sometimes a bank will waive that fee if it’s the first time you’ve committed the mistake and you actually call and ask for mercy.
Payday lenders do require some information, and usually demand that you provide your name, age (it must be at least 18), proof of employment, bank account number, social security number and proof that you make at least $1,000 a month.
Payday lenders generally say that they offer 99 percent guaranteed approved quick loans, meaning that not everyone receives a loan. You may still be too much of a risk for the payday lender if you haven’t held your job very long. They often require that you’ve worked there at least three months.
Disadvantages
However, guaranteed payday cash loans generally have much higher interest rates than banks. For example, a mortgage rate is about 6 percent and a home equity loan not much higher; while guaranteed payday loans can range from 15-30 percent -- over the course of two weeks.
A 15 percent interest rate loan may not sound like much, except when considering that a 15 percent two-week loan is actually a 390 percent annual interest rate.
Some laws consider loans that reach a certain percentage to be so bad that they refer to them as criminal acts. Some states have laws about how high an interest rate can be. For example:
In South Carolina the maximum is 15 percent.
West Virginia lenders can charge up to 31 percent interest on loans of $2,000 or less, and 27 percent on loans between $2,001-$10,000.
In Massachusetts, instead of having set loan amounts, payday lenders can lend up to one third of the borrower’s income.
In New York, payday lenders can’t charge more than an annual interest rate of 25 percent.
Keep in mind, some places have completely banned payday lenders.
What do I need to apply for a payday cash loan?
Just because they offer faxless paperwork doesn’t mean you won’t need to give some information and sign some papers. Try to bring your bank account number and routing number, your contact information, address, proof of employment, position at your company, driver’s license and work contact information. To apply for a guaranteed payday loan or to see if you qualify, go to the top of this page and fill out the contact form.