In simple words, a payday loan is an amount you take that has a very high-interest rate implied on it. It is similar to borrowing a certain amount for a short-term period on which the lender will exhibit a very high-interest rate credit that is solely determined based on your income.

People take payday loans because it doesn’t require any collateral that is to be kept.

Despite the interest rates being very high, people still opt for payday loans because it makes their work easy if something is to be taken care of and can’t be kept on hold for longer. Some lenders that give away payday loans are usually found online, but the most common ones are the small credit merchants, the ones who have physical stores in the market that allow onsite credit applications and approval.

Since these loans don’t require any collateral that is to be kept in exchange for the amount lent to them, their ability to pay is also overlooked. Because of this, the extremely high-interest rate comes into play, sometimes making it difficult for the borrowers to repay the money, resulting in them falling into a huge debt trap.

Why should you avoid Payday Loans? And how can you repay them?

This is why payday loans should be prohibited, there have been a lot of rules and regulations, laws in motion, working to settle down for a healthier alternative. Some money lenders have ulterior motives, which involve involving unusual provisions in the official clauses causing them to have authority over the borrower’s properties or other personal commodities through means of cheating and committing fraud.

The basic way of this loan to process is by displaying the payment slips that you get from your employer which show your income thoroughly, after which sometimes, lenders lookout for the borrower’s daily wages to be kept as collateral. The most basic way of fixing the other hand of this deal is to pay off the loan that is lent to you before the next month’s pay, but because of the higher interest rates, some borrowers fail to meet this condition.

The other way around to pay the loan is when the borrower writes a postdated check that includes the full loan amount and the additional fees along with any one of his commodities, when the maturity date arrives the borrower must pay the amount in person. If for some reason the borrower fails to do so, the lender can redeem that postdated check which was handed to him before.

In this case, if the borrower’s account runs short of funds that are to be repaid for the loans, they receive a bounced check penalty, making them guilty for not only paying the loan amount, and the additional interest implied on it, but also the penalty that comes with every bounced check.

This proves to be a very gruesome issue for small-time workers and people who aren’t well-to-do in life, putting them in a vulnerable position. But it is not like you can’t escape this issue ever, there are other ways that you can choose to go with except applying for a Payday loan.

How do I make it out of this without getting a Payday Loan?

Finding the best payday lenders might look like a hectic task to accomplish but it is not impossible. You can look out for lenders that have known you and whom you can trust well. You can read through the terms and conditions proposed in exchange for the loan and you can negotiate to get a better deal.

Some other healthy alternatives include applying for a pawnshop loan, borrowing from a friend or family, having a side-business apart from your main source of income, applying for a bad credit loan, etc.

In the world of short-term loans, a cash advance and a payday loan are the same thing; both of these terms refer to a type of loan that is based off your next paycheck. In today’s world getting Loan approval in an instant time is way easier and can be done. There are some rules and requirements for taking any loans. For every type of loan, the process is different and also various different documents are required. But one needs to pay the amount taken back on time to make sure the score which will be awarded to you remains good. This class of loans allows you to get an advance on your next paycheck without any real form of collateral aside from your job, and has become an increasingly popular form of financing for consumers nationwide.

However, cash advance loans and a credit card cash advances are not the same thing by any means. Just as the name of the second product suggests, the source of the funds comes directly from your credit card – provided you have a credit card that will allow you to take a cash advance out against your existing line of credit. These cash advances often have many stipulations that are buried deep within your cardholder agreement, so its important to review the agreement to be sure that you understand what you’re getting into ahead of time.

Common stipulations include: * Activation of cash advance feature (this can include a wait time for a PIN) * Additional fees assessed to your account when you take out your first cash advance * Additional fees assessed to your account for each billing cycle that your cash advance plus interest are not paid in full * Increased interest rates for both cash advances and purchases

Every bank is different, so before you consider taking out a cash advance using your credit card it would be wise to call your issuing bank and ask them what the consequences would be if you chose to finance your needs using a credit card cash advance. Alternatively, it might be smarter (and safer) to choose a cash advance loan issued by a company apart from your credit card company so as not to suffer any of the negative consequences.

Cash advance loans do not require a credit check, nor do they post any report to the various credit bureaus if you honor your loan agreement. This is the definitive difference between a cash advance loan and a credit card cash advance – with the loan you receive no bureau reporting, with the credit card you do. This is important because any inquiries or updates to you credit report can cause the interest rates on your credit cards, mortgage loans, etc. to skyrocket. Again, this varies from company to company, but in many cases this is written into your contract so its important to consult your current lenders before you make the decision.

In the end, its generally safer just to get a cash advance loan from a company that specializes in cash advances. Because there’s no bureau reporting or credit check, no one will ever know that you took the loan out unless you tell them. The interest on these loans is also comparable to or even lower than the interest that you would pay on a credit card cash advance, so its easy to see why this sort of loan is becoming a popular choice for consumers today.