Payday Loans are lent to people with low incomes in US. The loans are usually of small amounts(are of USD1000 or less) and have a very short time given ( 7-14 days) for the repayment. The repayment is usually due on the next of the borrower’s paycheck. These loans are lent at a very high interest rate.
However, from time to time people will be forced to look for instant lending. Circumstances such as; accidents, health issues, family matters, unintended expenditure will leave you with no enough time to wait for a different source of money for example; your salary. Requirements for most of financial loans are; collateral or a certain level of the borrower’s credit score. For these loans’ qualification in US you should have the following;
- An active bank account
- Evidence of a stable source of income such as; employment, social security and disability scheme.
- 18 years and above.
The bank accounts are necessary for these loans applications because the funds are usually transferred from bank to bank.
In US a Payday loan application form is availed online for the interested residents. Therefore, the residents can always complete the application form online in case the need for the loan arises. The forms are usually one page long, it only takes you a maximum of 10 minutes to complete. You are required to keenly verify the details on your credentials such as; your personal name’s spelling and your bank account’s number. Failure to give the details correctly, can hinder you from being given the loan you applied for. You should therefore ensure every detail is correct before you submit the form. There is no need for faxing in this short term funding offered by these loans.
After the submission of the loan application form online, terms and rates which suit your state are availed. You choose whatever rate that suits your current need. Then the lenders give you a phone call for the approval of your loan application. They take a maximum of 45 minutes to reach out for you. Then if there are no hindrance, the money is forwarded to the bank account you provided on your application form. You can therefore withdraw the funds using ATM cards. US residents with low credit scores or those who make delayed payments for their loans are also considered when they apply for Payday loans.
However, researchers talk about how high the rate of borrowing these loans is in USA. They are continuing to gather more information from the borrower to see whether high rate of borrowing is out of necessity or people borrow because the loans are availed to them by the lenders. Critiques argue that the lenders use this loans to trap the poor people in US into a whole filled with darkness of paying high interests for the loans they are offered. Together with Innovations for Poverty Action, researchers and Lenders are gauging on the borrowers’ decision when it comes to these short term loans.