Bad Credit Payday Loans
If you’ve found yourself in a bad financial situation and want to avoid getting into even more debt then you should consider getting a bad credit payday loan. Everyone runs into unexpected financial problems at one time or another. Your car may need to be repaired, or you need to pay off an unexpected medical bill. There are many things that can suddenly come up and leave you needing money before your next payday. If this happens to you then there are options open to you. One such option is getting your hands on a bad credit cash loan.
Before we continue we have a quick warning about borrowing. You need to ask yourself if you really need a loan today. Borrowing a small amount of money can be expensive and it may not solve the money problems you’re currently facing. Please check the options you have before deciding on taking out a loan.
If you would like more information about alternatives to borrowing and ways you can manage your bills and debts then please call 1800 007 007 to get free independent financial advice. If you’re having trouble paying your utility bill then talk with your suppliers for electricity, gas, water or phone company to see if you can arrange a deal. If you are on government benefits and you need money fast you can phone 13 17 94 to see if you can have your Centrelink payment sent early. If you’re unsure then head to the MoneySmart website provided by the government to find out more information about small loans and alternatives to them that could be a lot of help.
These payday loans, also sometimes called a cash advance loan, is when you borrow a small amount of money from a lender for a short amount of time. Because of the shorter time limits on them they usually also come with higher fees. A payday loan is usually for between $100 and $1,500 and the loan period is usually between 16 days and two months. In some cases you can get a longer period of up to 1 year to pay back the loan though.
Taking out a payday loan is a quick way to pay off some small and sudden expenses. There are some drawbacks to taking out such a loan however. The biggest concern when it comes to payday loans is the higher interest rates attached to them. You will typically pay back the loan by setting up direct debit with the lender for the money to come out automatically after a set period.
Is it really possible to get a payday loan if I have bad credit?
A payday lender will lend money with different lending criteria than a more typical lending institution like a bank or credit union. This is why they are able to offer money to people who have a poor credit rating. A payday lender will usually look only at your ability to repay the loan and how your finances look when you actually apply rather than how your credit rating as a whole looks. You will usually have to provide a lender with information about your current finances including bank statements for the past 90 days. This is just one of the things they use toe decide whether or not you will reasonably be able to pay back the money.
You should take a careful look at how your current financial situation stands before taking out a payday loan. Ask yourself if you really need the money and can reasonably afford to repay it. If you’ve got a particularly bad credit rating but do currently have a guaranteed income then you may want to consider a no credit check payday loan.
What are the features of these payday loans for borrowers with bad credit?
There are a number of reasons why a person would consider applying for a payday loan. The following are some of the things you need to consider before applying for any kind of payday loan.
- Can you apply online?
Most payday lenders allow you to submit your application form online and not have to deal with any physical paperwork. You will still need to provide them with information about your bank statements though and give them information about your employment and your address. The lender will then verify this information. There are many lenders that don’t take your credit history into account and will simply look at your current financial situation as the loan will not be for a long period of time. This makes them a good choice for people who have a bad credit history.
- Is there instant approval?
Many payday lenders will let you know if you’ve been approved or not just minutes after submitting your online application. You can sign up to receive the loan online so you don’t even need to go to the bank or fax documents to get your hands on the loan.
- How quickly do you receive the money?
One of the biggest advantages of taking out a payday loan is that you will receive your money quickly. Typically a payday lender will send the money to your bank account within just 24 hours. This can really help out when something expensive happens without warning.
- How flexible are repayments?
A payday lender will usually use your income and how often you are paid to come up with a repayment schedule. The payment will come out of your account on the specified day until the loan is fully paid off. You should ensure that you have money in your account at the time as you could end up having to pay more in fees if there isn’t.
- Could you be left with long-term debt?
Payday loans are there to provide you with quick cash to pay off a small expense. The loan period will typically be from between 16 days and 2 months. It’s possible to ask for slightly longer to repay your loan if you need it but there may be an additional fee for this.
- Is it possible to make extra repayments?
You may find that you get your hands on some extra money when you need it most and no longer need the payday loan. Will your lender let you repay the loan early if you have the chance to? Some lenders do and some lenders don’t. Even the ones that do may apply a fee to this.
What you need to know and do before you compare payday loans
There are many payday options online so it’s difficult to choose just one. This is why you need to compare the different loans out there so that you can pick the right one for you. Here are some things you have to do.
Do some research on the lender
It’s important that you research the lender before doing business with them as they are going to have access to your bank account. Take a good look at their website and read their policies. There are some online lenders that will let you chat live with a member of their support team and get answers to any questions you have. You should also search for the lender online and see if you can find any reviews or testimonials from people who used them. It’s easy to find all this information online so ensure that you do some research first.
Learn about the interest rates and fees
Because you’re getting the money so quickly you can expect to pay high fees and interest rates. The Australian Securities and Investments Commission has laid down rules that say a lender can only charge up to 24% of the initial loan amount per month in fees. There may also be other government fees and charges, along with default fees and other potential expenses.
How quickly will you get your money?
Do you need the money as quickly as possible? Or can it wait a day or two? Find a lender that can get you the money when you need it. Some lenders can get you the money in a matter of hours as long as it is a business day.
Is it possible to get an extension or a redraw?
Some lenders will let you extend the loan term up to 90 days if you need more time to repay it. If you do that you can expect to have some extra fees lumped onto your loan though. You should always ask what will happen if you fail to make a repayment on time. You should also ask the lender if there are any hidden fees that might come up that could hamper your ability to repay the loan. You should know how long it should take you to repay the loan so that you can avoid taking out an extension.
The Pros and Cons of payday loans
It’s quick and easy to apply for a payday loan: That you can apply for a payday loan online takes away the stress of filling out paperwork and makes applying for such a loan simple and convenient and a good way to deal with unexpected expenses.
You get the money fast: Payday lenders will usually get you the money within 24 hours and some can do it in less than an hour
Fixed rates and charges: Payday loans don’t come with interest rates. So you know precisely how much you need to pay and can budget around it.
Credit history doesn’t matter: Payday lenders will usually look only at how you are currently performing financially. If you’ve got a bad credit history it shouldn’t stop you getting a payday loan.
There are plenty of options: One great thing about payday lenders is that there are so many of them that you should definitely be able to find a payday lender that can cater to your exact needs.
They have high fees: Payday loans will always come with higher fees that other kinds of personal loans. It will cost you more than you think and may end up costing more than you can reasonably afford.
They are only good for the short term: A payday loan is not a good idea if you have long-term financial troubles. They should only be considered a short term quick fix and will not help you take care of more long-term debt. If anything they may just add to it.
Not every lender is on the up and up: A downside of there being so many different payday lenders is that some of them are dishonest. It’s also difficult to tell which lender is dishonest because it’s not like you can just take a trip to a store and look around. This is why it becomes so important for you to do your research and only work with a reputable lender.
How to apply for a payday loan and avoid getting ripped off
It can be a bit tricky to find and apply for the right payday loan with all of this choice out there, especially for a first time borrower. So take advantage of comparison websites to get the best deal for you. Just follow the link to the website of the lender to find out more about that particular lender and apply for the loan.
You should also always take a look at your personal financial situation so that you know for sure you can repay the loan. While each lender will have different requirements you need to be a permanent resident or a citizen of Australia, over 18 years old, and currently employed at the very least to get a payday loan.