A payday loan is a unique financial product that offers some special benefits you're not likely to get from traditional loans. The following are five of the major benefits of this method of borrowing:
Your credit score is not so important and is less likely to disqualify you.
When you borrow a payday loan, your credit score is deemphasized and much of the emphasis is placed on your paycheck. Your paycheck and your employment act as a kind of credit for you. It's therefore possible to be approved for this type of loan even though your credit score is not very high.
The application process is typically fast and straightforward.
It's often necessary to come into an office in person and sit through an interview with a financial institution representative to take out a traditional loan. The payday loan application process is often much easier and can sometimes be done almost entirely over the Internet.
You can expect an immediate response when you apply for a payday loan and can get that response without leaving the comfort of your own home in many cases.
You can set up automatic payments so that you don't have to worry about forgetting.
Payday lenders will usually set up automatic payments for you that coincide with the date when your paycheck will hit your bank account.
It can be difficult to remember all the different bills and payments you need to handle on a weekly and monthly basis. Therefore, automatic payments make your life easier and minimize the chances that you'll miss a payment.
You know you'll be able to budget for repayment because payment amounts are determined by how much your paychecks are for.
With a traditional loan, you're largely left on your own in determining what loan payment will be manageable for you every month.
On the other hand, budgeting for a payday loan is simplified by the fact that your paycheck amount is integral in determining how much you can borrow and how much you can pay back each month.
Applying for a loan does not usually hurt your credit score.
Traditional lenders will always run a credit check on prospective borrowers. However, payday lenders usually don't run credit checks on applicants.
This is good news if you're trying to build your credit. Every inquiry on your credit report has the potential to damage your credit because it shows that you're looking for financing. Getting a loan without undergoing a credit inquiry is ideal if you need a loan but haven't yet built up strong credit. For more information, contact companies like Payday Express.
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