Sometimes, we go through financial situations that require a relatively small amount of cash that you need to get as fast as possible. Online cash loans help fill in the gap for these short-term small-scale cash needs. These easy loans can be very handy and beneficial in certain circumstances, but you’d want to take them with caution to avoid costly financial consequences.
What Are Fast Cash Loans?
Fast cash loans are short-term loans you can get against your next salary. These loans are also called cash advance loans and payday loans. Quick cash loans are typically offered up to $500, but other lenders may offer more. The loan term runs for 2 weeks to 1 month. You should settle your loan within this period; otherwise, the lender may roll the loan over to a new deadline, costing you new fees and charges.
How Quick Cash Loans Work?
The dynamics of quick cash loans are simple and uncomplicated. If you need to take a small loan amount that you believe that you can pay within the next paycheck or two, simply contact an online lender or visit the lender’s physical store. Bring and submit the required documentation, fill up the application form and look over the terms and conditions. Lenders typically require you to write a post-dated check for the amount of the no credit check loan plus the fee or authorize them to debit the loan amount and the fee on the due date. If you’re unable to pay the quick cash loan back within the loan term, you and the lender may agree for a fast loan rollover wherein a new due date is set and new fees are charged.
The Cost of Online Cash Loans
While charges for other types of loans are expressed as interest rates, online cash loans differ slightly. Instead of interest rate, online cash loans are charged with flat fees. Typically, these fees run from $15 to $30 per $100. Therefore, if you borrow $100 with a flat fee of $15, you owe the lender a total of $115.
When you calculate the entire cost of the online loan expressed in APR (annual percentage rate), a quick loan with a flat fee of $15 is charged with 391% in APR. In evaluating any type of loan, looking at the APR is important. For instance, traditional loans from mainstream lenders usually charge around 7% in APR while a standard credit card carries around 12% in APR. This means that getting $100 in cash advance is more expensive than taking the same loan amount from your bank.
Highlights of Online Cash Loans
Fast and Easy application – getting no credit check cash loans is probably the easiest and fastest way to get the required funds within a short period of time. Most lenders will only require you to submit the following documentation:
Proof of identity (valid ID with photo)
Proof of regular and consistent income (pay slips)
An active bank account
Social security or tax identification number
You also need to be at least 18 years old and a resident of the state where you’re getting the no credit check cash loan from.
Once all requirements and conditions are met, the no credit check cash loan will be processed and approved for as little as 30 minutes. Some lenders will allow you to transact via their website or storefront, while others exclusively take online applications.
Also available for bad credit borrowers – bad credit score is quite a bane in getting loans. But most lenders will allow borrowers with less than perfect score to take out bad credit cash loans as long as they’re able to establish their financial capacity of paying the loan back.
Useful in times of financial emergency – given that cash loans for people with bad credit are processed and approved very quickly, these financing solutions have become an ideal source of instant funding in times of an emergency.
Drawbacks of Fast Cash Loans
High interest rate – needless to say, cash loans have very expensive interest rate. The rates for bad credit loans are over ten-folds to the interest rate of traditional loans. It is important to check the terms and conditions and explore cheaper options before signing up for bad credit cash loans.
Delinquency and default could reduce your credit score –your inability to settle the payments on the due date will affect your credit standing. Missing or delayed payments as well as completely defaulting on your loan will result to lower credit score.
Best Practices for Maximizing Cash Loans
Online cash loans are indeed some of today’s quickest and most convenient financing solution. They are quickly accessible for small-scale but urgent expenses; but they can also get very expensive if you can’t commit to your due dates. In order to maximize the benefits of cash loans, consider the following best practices.
Shop around first. There are now thousands of lenders offering cash loans and with varying interest rates and terms. Do take your time comparing their offers before signing up for any lender.
Take only what you need. Don’t overcharge the amount of your loan, thinking that you will have some more extra money to blow. Fees are usually applied for every $100 you borrow, so the higher your loan amount, the more fees you have to pay.
Take them only for emergency purposes. If you are routinely getting online cash loans to help you meet even the most basic needs, you probably have a problem managing your own finances. As much as possible, live within your means and take quick cash loans only as a last resort. Consider other cheaper options first before taking fast cash loans.
Settle your payments on time. Please note that no credit check cash loans are short-term loans. You need to settle them as quickly as possible in order to avoid roll-overs and incurring additional costs. Furthermore, paying the online loan promptly will help improve your credit score.
Fast online cash loans are very handy solutions, but they’re not always the best solutions in all kinds of financial situations. Read the fine print, discern your financial standing and assess your ability to pay off the loan on time to make online cash loans useful and manageable.