5 Myths about a Payday Loan Online

A payday loan online is a relatively new product for the market. And although many customers have already appreciated the benefits of this service, unfounded rumors still circulate about the activities of microfinance organizations. Consider the most common ones and learn more about payday loans here.

Myth 1. Payday loans have a huge interest.

It is believed that the interest rates on micro-loans are too high, leading to large overpayments. However, you need to understand that a payday loan is a quick loan, which is taken for a period from a week to a month. With timely repayment, large interest rates simply do not have time to “run up,” so the overpayment is insignificant.

Myth 2. You should use a payday loan only as a last resort.

This opinion is related to the previous prejudice about high interest. Allegedly, you can take a short-term loan only in a situation if it is not possible to get a loan from a bank. On the contrary, loans online are very profitable in cases where the speed of loan processing is important and the loan amount is small. For example, only today there is a 50 percent discount on a long-liked coat or a travel agency offers at an attractive price for a ticket. In such cases, a loan from a bank, which will take two or three days to complete, is an inappropriate option. But an online loan offered by microfinance organizations will allow you to take advantage of a profitable offer and, as a result, save money.

Myth 3. Payday lenders don't approve large loans.

It is not true because first time the lender may approve a smaller loan but if you pay it back on time next time you will be able to count on getting a larger loan amount. Usually, the loan amount is from $100 to $1500. However, personal loan lenders may consider your application and approve a larger loan amount depending on your income.

Myth 4. Payday lenders lend to everyone

Since it is possible to get a loan in a microfinance company quickly, many people mistakenly believe that anyone can take a loan without checks. In fact, the simplicity of the procedure for the client does not at all mean frivolity on the part of the lender. The lender does not require the provision of a certificate of income, but carefully checks the reliability of the borrower. However, most customers have nothing to fear: the reason for refusal can only be a very overdue credit history.

Myth 5. Payday lending companies are semi-legal companies with a dubious reputation.

The activities of payday advance lenders are regulated by the law. Reputable payday organizations operate in the legal field. Companies are required to provide accurate information on interest rates, commissions, overpayments. A visitor can calculate the cost of a loan using a calculator posted on the websites of most microfinance organizations.

Now you know all the truth about payday loans online and can apply for a loan without worries if you need money quickly.

This entry was posted on Saturday, June 29th, 2019 at 7:40