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Payday loans are a popular source of immediate cash to qualified individuals. These types of loans are short term and expensive. It is costly to borrow from payday lenders because of the high-interest rate. If you are one of the many people who wish for a low-interest rate for your payday loan, let me tell you now that you will not get what you wish for.
Why it is impossible to get a low-interest rate for payday loans. Well, it is a fact that payday loans are usually payable in 15 to 30 days. So, you only have two weeks to a month to repay your loan. This is good for the lenders if you think about it, but not when borrowers default on their loan. And there are many borrowers that fail to pay their loan so this is bad for business.
Take note, payday loans are easy so obtain because of the lack of requirements and fast processing. It is possible for anyone to get a loan regardless of credit rating as long as they satisfy the basic criteria of payday lenders. What are these criteria? You need to be employed and you got have a bank account that accepts direct deposit. It is also required that borrowers are resident or citizen of the United States and of course, you must be of legal age.
Payday Loans are also expensive because lenders are not required by the federal law to offer low interest rate to customers. The states only put a cap to prevent abused while some lenders offer borrowers discount. But the discount is on a case to case basis and depending on the borrower’s relationship with the lender.
So, if you are applying for a payday loan and hoping to get the lowest interest rate, be prepared to be disappointed. Payday lenders are not required to offer the lowest rate, but you can still ask.