Short Term Payday Loans Guide

Short Term Payday LoansIf you’re in need of short term payday loans, you’re in luck, because most payday loans are due back on your next payday. In fact, long term payday loans don’t really exist, as these would be more like installment loans, which are not payday loans.

If you want a really short term you can’t get much shorter than a payday loan. In fact, this is one of the major reasons why people say payday loans are so bad and the fees are so high, because you don’t get the money for very long. It’s the trade-off for not having to put up any collateral, and since the loan is directly linked to your job, it only makes sense that the lender wants their money when they know you’ve got it.

If you go in on your payday to take out a payday loan, and you’re paid every two weeks, you’ll get two weeks to pay it off. You’ll typically get two weeks even if you’re paid biweekly. If you’re paid monthly, you’ll get a full month to pay the loan off. This is often the case if you’re receiving a monthly benefits check. This is typically the longest time you’ll be able to take out a payday loan.

Short Term Payday Loans Guide

You’ll need to verify with your lender when exactly the loan will be due. Let’s say you get paid this coming Friday, which is 4 days away. Most lenders in most states will be required to give you until the following payday to pay the loan back. This works in your favor because you’ll have more time to pay the loan off, and you’ll be able to put that next paycheck in the bank, and pay your loan off with the subsequent paycheck.

How Payday Lenders Make So Much Money
The reason the APRs get so inflated when dealing with payday loans is that you’re typically only getting the money for a few weeks, and are then expected to pay it off all at once. In normal lending practices you’d get a year or more to pay off the loan, and that’s where the annual comes from in Annual Percentage Rate. Because of the shortened timeframe, you are getting far less time to use the money, and so the fees that are associated with it are considered very high by most calculations.

Why More Time Benefits You
Having the loan out for a longer amount of time is in your best interest because it gives you more time to use the money for what you needed it for in the first place, and it helps you get out of the cycle of debt often referred to as the payday loan trap. The reason so many people run into problems with short term payday loans is because they still need the one two weeks later, and are forced to take it out again and pay all of the fees again.

Let’s say you could find a long term payday loan, and you had 3 months to pay it off instead of 2 weeks. Chances are your financial crisis would have a chance to return to normal, and you’d be able to pay the loan off either in installments or all at once three months later after saving up for the expenditure. But you likely won’t be able to make up the difference on your next payday without dipping into important expenses like utilities, rent, or food, so you have to take the money out again. So really you should be searching for ways to get the money for a longer time period.

Rescinding the Loan
If you only need the money for a few hours, many payday lenders will allow you to rescind your loan. This involves paying the loan back by the close of business the next day and only having to pay back what you borrowed, with no fees. It’s sort of a cooling off period for those that don’t like the idea once they go through with it. But for those instances where you just need the money for a very short time and can bring it back the next day, or even the same day, this might be an option for you.

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