How Payday Loans Work
If you have ever found yourself in a situation of emergency need for cash, be it because of unexpected bills, extraordinary medical circumstances, or other financial struggles? In that case, a payday loan is a valid alternative in case your bank account is not able to handle the emergency and no friend or family member can assist you.
Payday loans are short-term loans, usually ranging from $100 to $1000, and the borrower accepts to pay back to the lender by the next paycheck he or she receives. Now let’s see how you can apply for one and what requirements you must possess in order to obtain the approval.
What Is DirectLoanTransfer?
DirectLoanTransfer is a service born, thanks to some of the best financial experts in the country, with the idea to meet the needs and requests of clients in need of cash advances throughout the US. Through the website, you can easily apply for short- and long-term loans in just a few hours and receive the money even the next business day.
It operates as an online service, connecting the client to the lender in its wide network, which matches the borrower’s request best. Therefore it is not a direct lender and is completely free to use, not requiring any payment and not charging any fee prior to or after its usage.
How to Apply for a Payday Loan Through DirectLoanTransfer
- Have the documents you consider necessary ready and tidy so that you do not waste time looking for them or risking having your application denied because you failed to provide a specific document. Less paperwork is necessary for short-term loans, such as payday advances, but it is nevertheless a good practice to be well prepared.
- Find the option “Apply” on the website to start the application process. Fill out the form and submit all the information requested. After reviewing it, finalize the application and send it, then wait for the approval, which usually takes just a few hours.
- If the lender accepts your application, you must sign a digital agreement with them. Read all the terms carefully and pay particular attention to the additional fees and penalties you would eventually have to pay to the lender.
- After both parties have signed the agreement, the loan is accepted, and the money will be deposited in your bank account, usually by the next business day.
What Are the Requirements to Apply for a Payday Loan?
Specific requirements depend on the lender you end up stipulating the loan agreement with; nevertheless, there are at least five main criteria you absolutely must meet if you want to apply for whatever type of loan online.
- Be of legal age, i.e., 18 years old or older.
- Be a legal citizen or resident of the United States, and have your place of employment in the country.
- Receive an average monthly wage of at least $1,500.
- Have an active checking account with no overdraft.
- Have a valid email address and phone number.
The employment requirement is, again, fundamental. Since no credit check is run on the client at any step of the application process, the lender must have at least reassurance on the ability of the borrower to repay the debt. That is why proof of employment is of the utmost importance to have your application approved.
Why Choose Short-Term Loans?
If you are not sure about payday loans and whether they would be a good option adaptable to your financial situation and needs, here are a few reasons why short-term cash advances are a great choice.
- Payday loans are fast to get approved, a factor which could be a godsend for those with a really urgent need for cash and not much time to go through the long, exhausting and complicated process of asking the bank for a loan.
- No credit check is run, so you can apply even with bad credit history. When it comes to loans that are to be repaid in the short term, lenders at DirectLoanTransfer never run a hard credit check. That is, they never check your background credit history. As long as you respect all the lender’s requirements and the must-have criteria, you can apply and get accepted for a loan even with bad credit.
- Payday loans are available in most states of the US (for the complete list, please check the National Conference of State Legislatures’ website). Since they are short-term money advances of a usually relatively small amount, hundreds of lenders across the country accept applications with little reserve.
- High-interest rates, but for less time. One of the main cons of short-term loans is, logically, the high-interest rates that come with them. They are high because lenders have fewer warranties on their client’s ability to pay off the debt in a short period of time. High-interest rates are one of the reasons why you must truly think about possible repercussions before taking a loan. However, if you do the math, it could very well be that the amount you end up paying in the short term is less than what you would be paying in a bank agreement in the long term.
- Contrary to long-term money loans such as installment loans, payday loans require no repayment plan, taking away from you much of the stress of having to keep up with the repayment schedule. You have a deadline only, your next paycheck, which is easy to remember and makes it easy for you to plan your expenses around it.
- Since payday loans are paid off by the next time you receive your paycheck, you won’t be in debt for much time. This is a huge win. Many borrowers lost everything because they could not keep up with the repayment schedule, debts, and relative interest fees. A good piece of financial advice we would like you to remember is: the less you stay in debt, the better it is.