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Payday Loans On Benefits
Of all the loans offered in the market today, a payday loan is the fastest and most convenient one. This is why it’s one of the well-known financial alternatives if the borrower is experiencing an emergency or is in need of quick cash. Also, it asks for only a couple of requirements, thus, making the entire loan process hassle-free. However, the borrower must meet all the criteria in order to be eligible. The criteria focus on the capability of the borrower to produce enough income. But what if you’re unemployed or disabled – does this mean that your application will never be approved anymore?
This article will discuss the basic things you need to know about payday loans. It will work as a guide that is beneficial to answer the basic concerns you have with cash advance loans.
What Is A Payday Loan?
Also known as cash advance payday advance, small-dollar loan, payroll loan, or short-term, the loan amount can be used for different purposes, such as daily expenses, medical, travel, etc. It is designed to address emergency concerns, therefore, it’s acquired with a couple of days or an hour, depending on the company’s terms and conditions. The loan does not ask for many requirements, however, the borrower must meet all the prerequisites before gaining approval.
Unlike other types of loan, it doesn’t ask for any collateral or background check. This means that the borrower is not asked to surrender any asset including cars, mobile phones, laptop, jewelry, etc. No credit check will be checked, therefore, it doesn’t matter if you a poor or bad credit remark. Nevertheless, the lender will be firm for one prerequisite – the source of income.
Payday loans are risky to many lenders because they don’t hold anything against the borrower. This is why they ensure a source of income first to guarantee that the borrower can repay on time. Most payday lenders will require a regular employee while other lenders will allow unemployed individuals as long as they are receiving benefits.
What Do You Need To Know About Payday Loans On Benefits?
People who are incapable of producing high income or those who are not able to produce anymore also experience financial difficulties. Sadly, regular loans are not applicable to them because they are not regularly employed. However, this doesn’t mean that they will never gain approval.
Benefit payday loans are created specially to attend to their needs. This loan is available not only to persons with disability (PWD) but also to single parents, those who earn very low income, etc. Payday loans benefits usually have a lower interest rate, depending on the facility. While most borrowers can borrow from banks, other individuals may submit their application to credit unions, online lenders, car title loan providers, etc.
The money may have come from different sources but as a rule, it needs to be repaid on the next payday. This is what makes payday loans for benefits a little more expensive than the other types; the loan amount needs to be settled within two weeks and the loan is composed of the principal rate and the interest charge. Nevertheless, it is extremely helpful when you have a financial dilemma that needs urgent action.
Representative 305.9% APR.
Representative example: £400 borrowed for 90 days.
Total amount repayable is £561.92 in 3 monthly instalments of £187.31.
Interest charged is £161.92, interest rate 161.9% (variable)
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