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Although there aren't many attractive loan options with good interest rates for people with no credit history, there are some options to save the day. Payday loan is one such loan option that is immensely helpful for month-end money crunches and emergency financial needs. Payday loans are easy to apply, easy to obtain and easy to payback too.
Many times, financial needs crop up at the month end, for some purchases, or bill payments to avoid late payment fines. In such circumstances, loans without elaborate procedures are desired, and for people without credit history, obtaining such loans without credit checks might be a challenge. Payday loans are provided by many big loan companies these days owing to the popularity and demand for these loans.
Payday loans operate in a fairly simple way; an application is approved based on the employment record of an individual, and no credit checks are performed. The money lender transfers the loan amount to the bank account of the applicant, immediately after the application is approved. However, there are some requirements to get approved for a payday loan:
• The applicant must have an employment for at least three months at the time of applying for the loan.
• The applicant must be at least 18 years old.
• The applicant must have a valid bank account for the money transfers.
• The applicant must provide post dated check for the loan amount including the interest amount to the money lender, before receiving the loan amount.
The amount of loan that can be sanctioned depends upon the individual's salary. The application process can be completed online, along with submitting the online form. The applicant will receive the loan amount usually within 24 hours after the application is approved and the post dated checks are received by the money lender.
While this loan scheme is very appealing and an easy solution, there are some necessary precautions that an applicant must take before applying for the loan.
• The interest rates on payday loans are relatively higher than any other kind of loan.
• This loan must only be opted, if the applicant is capable of paying back the loan within a short period of time.
• This loan payment can be advanced for a couple of weeks, but the applicant must be aware of the growing interests along with the loan amount. Two weeks of deferred payment can accumulate considerable amount in interest.
Payday loans can be effective solution to financial needs, if all the precautions are taken and loan is paid back in time.