Friday, September 28, 2012

Take Care With Your Pay Day Cash Advance Loans

There are all kinds of personal emergencies that come up in a person's life from time to time. Some of them are our own doing, some of them are accidental or coincidental and some are actually our reaction to the circumstances of others. Sometimes we feel obligated to help out. Regardless of the reasons, pay day cash advance loans can serve a useful purpose to get the cash flowing when we need it.

Before taking advance of these quick loans available to working people without the use of a credit report, it's important to understand how they work. Although the quick loans that are easy to obtain can certainly come in handy, if you're not prepared to repay them in a timely manner, on the date and in the amount originally specified, these short term loans can become more of a hindrance rather than a help. Taking time to understand how they work and what will be required of you as the borrower is truly the key to success.

The first thing to know is that you should be very careful about borrowing money unless you are absolutely certain you will have the money to repay the loan when needed. This is true whether you are borrowing from a family member, a bank, a credit union, or a commercial cash advance lender. In some cases there may be an alternative if your due date arrives and you don't have the ability to make your loan payment. That is, of course, a common dilemma. We all struggle to meet our commitments from time to time because surprise expenses come up and catch us off-guard. Unlike family or installment loan payments, however, pay day cash advance loans must be repaid in a single payment and missing that payment date can boost your loan costs dramatically.

In exchange for the ability to obtain quick cash without being subjected to a credit check, your cash advance lender will require you to authorize an automatic withdrawal from your bank account so that it is guaranteed repayment on the date and in the amount you agreed to in your loan documentation. It's important to know that you cannot simply go out and open a checking or savings account for the purpose of obtaining one of these instant loans. The lender will take time to check and see that you have been using your bank account for a good period of time, and that regular deposits are made into the account by your employer. The pre-authorized auto debit is your lender's security for making you a loan without using credit scores.

Besides having your bank account for a substantial period of time, meaning a few months at the very least, you will also need to verify an income of at least 00 per month in order to qualify for loan approval. Of course you will also need identification cards proving your address and that you are at least eighteen years of age or older, the same age requirement for most any commercial loan. Assuming you meet these simple criteria, you will be able to obtain pay day cash advance loans without delay. Naturally, short term lenders tend to watch out for others in the industry, so they share information and you cannot obtain more than one cash advance loan against your next paycheck at any one time. That would not be ethical and it is certainly not practical. There is a reporting system used by pay day lenders for the purpose of identifying customers who attempt to double-up on loans, so just don't do it.

Wise use of pay day cash advance loans means being prepared to repay your loan and all the interest and fees charged on your loan on the date specified in your original loan agreement. Although loan renewal may be an option in your state (it is not available in all states) you will want to avoid it if at all possible, because essentially it is a new loan with a whole new set of interest and fees to pay. Paying on time avoids loan renewal issues entirely.

Many advisors will say that the only wise use of single pay loans is when you need emergency cash at a time when no other borrowing options are available to you. And furthermore, your intended use should be a genuine, unavoidable emergency, not simply an urgent desire to buy tickets to the final game or go on a cruise at a great price. These are examples of "wants," and they simply fail the test as genuine "needs." It may seem strange to you, but many people have difficulty determining the difference between wants and needs, so this point must be made here. Think hard about whether you can get the cash you need another way, and whether or not you really need the cash at all.

Once you are past the determination of need, and you have considered all your other options for borrowing, that is the time to give consideration to yet another issue. It is, naturally enough, the issue of careful budgeting. When your automatic withdrawal comes out of your checking account, it can really crimp your family budget until your following payday arrives. And that can be a long, dry spell that seriously inconveniences you and your whole family unless you have planned ahead and made plans to cover it.

One thing that some customers do is plan their use of pay day cash advance loans only for times when there will be an additional or extra influx of cash from another source. For example, tax refunds, sale proceeds, or settlement checks may be expected within the same time frame as you are using your short term loan, and that makes it much more likely that you and your family will not be inconvenienced when it comes time to repay your short term loan. Planning ahead in this way can make your single pay loan experience much more convenient and practical, both being hallmarks of wise use of your loan funds.

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