Every year, about 4% of Canadian households take out online payday loans. They use these types of loans to pay for everything from unexpected expenses like car repair bills to expected expenses like utility bills.
Are you currently thinking about applying for a payday loan for one reason or another? If you are, you should learn about all the pros and cons associated with these kinds of quick loans before filling out an application. It’ll help you decide if payday loans would be your best loan option in the end.
We’ve compiled a list of the pros and cons of payday loans below so that you can see if these instant loans would be right for you. Read through them now.
The Pros of Online Payday Loans
In recent years, online payday loans have become popular among those who need to borrow money. Of all the different loan options that are out there, they usually require people to jump through the fewest hoops to get their hands on them.
There are also lots of benefits of taking out online payday loans. Here are several of the biggest ones.
Allow You to Get Access to Cash Fast
If you need to take care of an expense ASAP, you won’t be able to wait around for days or even weeks on end for a lender to get around to approving you for a loan. You’ll need to be able to get access to the cash that you need in a hurry.
Online payday loans will put you in the perfect position to secure the funds that you need fast. You should be able to borrow anywhere from $500 to $1,000 in a matter of just a day or two as long as you qualify for a loan.
Enable You to Cover Any Kinds of Expenses
When you apply for online payday loans, lenders are obviously going to ask you how much money you would like to borrow. But more often than not, they aren’t going to inquire about why you need to borrow money any further than that.
As a result, you can use an online payday loan to pay for just about anything that you want. Regardless of whether you need to take out a payday loan to pay for a car repair bill, a utility bill, or something else, you’ll be able to use it for whatever you might need.
Help You Even If You Don’t Have the Best Credit
In order to get approved for most types of loans, you will need to have at least a decent credit score. Lenders aren’t always going to take a chance on you if you don’t have good credit.
But online payday loans are different. They’re essentially no credit check loans that won’t call for lenders to run your credit before approving you. So even if your credit report isn’t in the best shape, you should still be able to get approved for a payday loan.
The Cons of Online Payday Loans
As you can see, there are so many reasons why you should strongly consider taking out online payday loans when you’re in need of money. You should keep them in mind when you’re thinking about which loan options you’ll have.
There are, however, also some potential downsides to taking out online payday loans. Here are a few of them.
Limit the Amount of Cash You Can Borrow
If you need to borrow, say, $10,000 for a home remodeling project, you won’t want to consider going with online payday loans to pay for it. Most of the time, there will be a cap on how much money you can borrow with one of these loans.
Every payday loan lender operates a little bit differently. But generally speaking, you usually won’t be able to borrow more than $1,000 with a payday loan.
Subject You to Higher Interest Rates
All the different types of loans are going to come with interest rates attached to them. These interest rates will help determine how much you’ll have to pay over time to repay a loan.
Many online payday loans come with higher interest rates attached to them than other kinds of loans. Lenders will often increase the interest rates on payday loans because of the risks associated with them. They tend to give them out to those with lower credit scores, so the higher interest rates help to protect the lenders that give them out.
Give You a Limited Amount of Time to Pay Them Back
Some other types of loans will come with repayment periods that will stretch out over the course of several years. This isn’t going to be the case with online payday loans.
When you take out a payday loan, you will typically be required to repay it within a matter of just a few weeks or sometimes months. You’re going to need to come up with a way to pay back online loans as quickly as you can.
Contact Us to Discover More About Online Payday Loans
Would you like to get additional information on online payday loans so that you can decide if applying for one would be right for you? We can set you up with the info you’re looking for.
We can also make it very easy for you to apply for online payday loans when you’re in the market for one. You can fill out an application for a payday loan in just minutes and get approved fast.
Reach out to us today to hear more about the fast loans in Canada that Kingcash can provide.