Quick cash loans: 7 things you should know| Oak Park Financial
If you’re caught struggling financially a quick loan might seem like the perfect solution you require.
While some lenders may employ the catchy title “instant loan,” a majority of them are payday loans, which are filled with poor conditions and still require the requirements for eligibility. In addition, even if the loan is approved, you may not receive your money immediately.
If you’re thinking about a quick loan here are seven points you must know prior to making your decision.
What you need to be aware of about instant loans
1. How do instant loans work?
In general, you have the option to complete an online application as well as in person. The application should include the amount you’d like to borrow as well as the duration of the repayment. It is also necessary to provide your personal details, based on the lender, such as your earnings and debts, Social Security number, bank account details, and an email address.
The lender typically promises to respond within a matter of minutes and deposit the funds into your account, when you’re accepted. Even if you’re accepted, in some instances it might take one business day or two -or longer to receive the money.
2. They may not be instantaneous.
Although the process of applying for a loan could be faster when you visit the location, it typically takes a long time — anywhere from several hours to a couple of days for a lender the decision on the online application and deposits the money to your bank account, if accepted.
If, for instance, you apply at a specific time of the day, you could not receive funds up until the following business day. The time frame could be even longer if the lender requires more details from you.
3. You could pay a high-interest rate
A lot of loans advertised by the name of “instant loans” are actually cash advances or payday loans, that are known for being laden with fees that amount to astronomical APRs. Based on the Consumer Financial Protection Bureau, payday lenders typically charge fees of about $15 per $100 loan in accordance with the terms of the loan as well as the laws of the state you reside in.
This is equivalent to an APR of nearly 400% on a two-week loan. Some instant loans could charge more fees and similar APRs of between 700% to 90 percent.
4. These are usually loans of a small amount.
It’s not the kind of loan you can get for the cost of a major home renovation. The amount you are able to borrow is typically modest, just a few hundred dollars, as these tend to be considered urgent loans.
5. There may be a short time frame for a loan
The short loan terms are a different characteristic of payday loans. It is possible to pay back the loan by your next payday or in a period of one to two weeks. This isn’t much time to bring the cash in order for repayment.
6. You might be approved for bad credit
These loans can be attractive for those with less than perfect credit due to the fact that many lenders do not check the credit report as well as credit scores. This may sound appealing, but they aren’t going to aid in building credit in the event that the lender fails to provide your credit information to the three major credit bureaus.
7. Certain companies are not able to lend in your state.
It’s because some states have banned payday loans. Additionally, in some states payday lenders have decided it’s not worthwhile to conduct business in these states since interest rates and fees are controlled. If you go to a site that advertises instant loans you’ll usually be able to search for an estimate of rates based on the location you are in.