How Do Payday Loan Advances Work?

Are you interested in receiving a payday loan advance? Are you not quite sure how these loans work and what the process is to get one? Well, they are very simple loans-in terms of the application process and the financing and repayment of them. These loans are based on what your regular paycheck amount is and then repaid in full on your next payday.

Many lenders do not pull a credit history to approve someone for a payday loan. This is because repayment is guaranteed-it comes directly from your next paycheck. If you are worried about your credit history being used to determine your eligibility for a payday loan advance, read through the lenders policies and guidelines first before applying.

Once filling out and submitting your online application, the approval process usually only takes a few minutes, if that long. Many online lenders are able to tell you right away if you are approved or not. If you do not get an immediate response, then further verification from you may be needed. Once you are pre-approved you may be requested to provide some sort of supporting documentation verifying your employment and income (such as faxing paycheck stubs to company). Other companies do not require this and will do the whole loan without you having to fax anything. After the company verifies your identity, your employment, and your income, then you usually receive a direct deposit of the loan proceeds into the bank account that you provided to the lender. This usually happens in 24 hours or less.

Do be careful when choosing your online lender. Due to the short duration of these loans, the interest rate and any applicable fees may be high. Do some research to find a lender with a reasonable rate. Also make sure that you do not borrow the money for a longer period of time than necessary. Doing so will cause you to pay back more money in interest than needed.

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