Looking to renovate your home or update the new kitchen but are short on cash? This is one of the most common problems that people face which is why they turn to lenders. But the only problem is, that getting a traditional loan can be a time-consuming process that requires you to meet various requirements of the lender which keeps many people from getting the funds they need.
This is where a payday loan can help you. Payday loans are a great choice for those who are looking to make minor renovations to their homes and need access to quick funds without having to go through the lengthy process of getting your loan reviewed and checking your financial background, which can take months. Here, we are going to take a quick look at what are payday loans and why you should opt for a payday loan when in need of quick, hassle-free financial assistance.
What Is a Payday Loan?
In the US, payday loans refer to short-term personal loans that usually come with a high-interest rate, but offers people access to quick cash. Contrary to popular belief, the terms of a payday loan aren’t necessarily connected to a person’s salary. The only reason why they are called payday loans is that the majority of people who take out the loan pledge to repay it on their next payday.
Emergencies occur without warning, and more often than not, involve money to pay for an illness, accident, theft and so on. Despite the high-interest rate for the repayment of the payday loan, more and more people look towards payday loans, such as those provided by Bonsai Finance to meet their financial needs during emergencies.
Another reason why a payday loan is the preferred choice of many working-class individuals is that it provides them with quick access to the money they need during an emergency. Unlike other types of loans, which require you to submit multiple documents, references and have a clean created score, not to mention the lengthy processing time to get a loan, with the payday loan you can get the loan amount in just a few days. The fast processing time of the payday loan means that you can get access to the money you need in a few hours.
Getting Approval for a Payday Loan
The credit rating of an individual is how banks and lenders measure the creditworthiness of the person they are going to give the loan to. It is a score that’s given to individuals as an indicator of how likely they are to be able to pay back the amount. Needless to say, a person with a low credit score means they have missed loan or credit card payments in the past and is the first indicator that they might not be a suitable candidate for a traditional loan.
However, when it comes to a payday loan, your credit history is not the only factor that is taken into consideration when it comes to giving a person a loan. Other eligibility requirements for a payday loan are:
- You should be the legal age of 18 years old when filling out the application for the payday loan
- You should be a citizen of the United States.
- You should be able to provide the lender with proof that you have a source of stable income
- You should provide the lender with proof that you are not facing any debt or bankruptcy
- You should have a Taxpayer Identification Number and SSN that you can provide to the lender you choose for the payday loan
- You should be able to provide the lender with information on a valid banking account, which can be either a checking or savings account
The reason why the payday loan is gaining popularity is that it allows even those individuals who have a bad credit history to get access to the funds they need when they need it.
Improving Your Credit History
Since your credit history is going to be one of the main factors to getting a payday loan, it pays to make sure that the information on your borrowing history and your credit application is correct. Why this is important is because even the slightest mistake or misinformation on your file could have a negative impact on your credit application, resulting in you not getting the loan.
Another great way of ensuring that you are eligible for a payday loan is to get your name registered to vote. This makes it easier for the lender to confirm your name and address, and it’s a great way to improve your credit score in the process. Since it can take up to three months for your credit file to get updated after you’ve entered your name on the electoral roll, its best to make sure you are registered beforehand just in case.
Fill Out the Online Application
Going online is by far, the most efficient way of getting a payday loan within the least amount of time. Since there are many lenders offering payday loans, the best thing to do is shop around to find the best options with the lowest interest rates. Once you have found the lender that is offering you the amount you need with low interest on repayment, all you have to do is fill out their online form to get started.
For this, you will need to provide the lender with your personal details. The good news is, the online application process for a payday loan is relatively easy, even for someone who his signing up for a payday loan for the first time.
The information that you will have to provide the lender with on the online application form will include, your name, address, contact information, and employment information. Once you have filled the online application, it usually takes a few minutes to find out if your application for the payday loan has been approved or not.
The best part about payday loans is that the lenders have extremely easy terms that allow all those who are going through financial hardships to get access to the funds they need quickly.