The economy is not perfect. We all earn money, some of us more than others, but the cash is often not adequate. Rich or poor, we often can do with some more cash. Sometimes the extra money is for buying things we want, but may not be essential to our existence, such as the latest television set or the latest gadget, or for going on a long cherished vacation, but at other times, the extra cash is for more immediate and urgent needs, like for instance, buying medicines, paying off utility bills, or making urgent car repairs. Of course, for purchases like a car or a home, we need a lot of extra cash.
A loan can give us the cash we need. There is no stigma attached to a loan anymore, as thousands of people the world over take a loan for various reasons. In fact, taking a loan is now a fairly common and accepted practice.
Both individuals and businesses need loans. While individuals need the extra cash for personal reasons, businesses need the money for buying tools, setting up plants, making expansions, paying wages, buying raw materials or supplies, for operating expenses and for a variety of other reasons.
Top Reasons Why People Take Loans
Credits and loans are sometimes the cornerstones of our personal finances. Here are some of the main reasons why people take a loan.
1. To buy a car and keep driving – Automobiles cost a lot of money. Most people thus need to take a loan. But cars break down too and the cost of repairs can be a lot of money as well. Many of us don’t have the money for this sudden and unplanned expense. A loan can help us pay for this repair.
2. For purchasing a house – That’s an even bigger investment than a car. A life changing event, it usually goes into thousands of dollars. A mortgage loan gives you the money to buy a house. With a smaller, short-term loan, you can make upgrades or carry out repairs, like painting jobs, garage repairs, replacing faucets, the tiling, buying a new table or cupboard or such others.
3. DIY jobs – Hobbyists working on do-it-yourself projects need the extra money to buy supplies and work on their projects. A loan for a few more dollars can come in as very handy here.
4. For their kids – As parents, we feel bad when we cannot buy things for children that they love and want. The smile on their faces and happiness when they get what they want is priceless. Those who don’t have money saved for the Christmas gift can take a small loan to buy the gifts. In fact, many people take loans to fund their Christmas or other special occasion purchases.
5. In an emergency – Money helps us immensely in an emergency. Perhaps it is to run some medical tests, buy drugs, or non-medical like paying off the home rent, utility bills, or urgent car repairs. It could be anything. Money can be a great crisis-saver in an emergency, often the most important thing. The worst part is, you never know when an emergency can hit, so it is almost impossible to prepare in advance for it, unless you have a lot of extra cash with you, which very few people have. Even if you are making decent money, it could mostly go away into investments, so you may not have adequate liquid cash.
6. When the monthly earning is low – Unfortunately, many people are not earning enough each month from their jobs. The economy is tough, so it may not be easy to get another job or earn extra from gigs on the side. It is a paycheck to paycheck existence for them. Even a few hundred dollars more could make a huge difference. A short-term cash loan till the next payday is the answer.
Long-Term Vs. Short-Term Lending
There are two types of loans – long-term and short-term. A long-term loan is for big-dollar spends such as for buying a home or a new car. A short-term loan, on the other hand, gives you a smaller amount of money for more immediate and other purposes.
Many experts are of the opinion that short-term debt is better because of the uncertainties attached with being in debt over a long period of time. Technology changes, advanced robotics and artificial intelligence taking away jobs, the economy going into depression, customer behavior changes, businesses going bust or closing down divisions, political or military troubles! There are far too many risks when you don’t know what the future is going to bring.
We all expect to earn more in the future. But in an uncertain world when you don’t know the future, it might be very risky to take a loan for 15, 20, or 25 years. What happens if you default? They could take away your assets, home or car. Thus, a short-term loan for your immediate requirements or little dreams is the better bet.
A Payday Loan is the Best Form of Short-Term Lending
Of course, there are many other short-term lending choices for consumers, but the fact is that, payday lending is the best option for most people. Why? Let us investigate.
In recent years, many policy makers and critics have come down heavily on payday lending. But it still continues to grow. Millions across the United States have been taking payday loans for many years now. In fact, these loans have now become popular around the world as well, from the UK to mainland Europe, Asia, Australia, and even Africa.
The millions of people cannot be wrong. They are asking for these loans because they see value in the offers, and because payday loans offer them the maximum benefit in an emergency or when they require extra cash.
Understanding Payday Loans
Payday loans are small dollar cash advances where the amount offered is usually between $300 and $1500. It’s only for a few weeks till the next pay check arrives. The best part about these loans is that, you are out of debt quickly, so there is little associated risk. You can apply on the Internet from anywhere. Your application is processed and approved quickly and money is deposited directly into your bank account usually within 24-48 hours.
Unique Features and Advantages of Payday Loans
1. These are loans for very small amounts. You will thus never be in a lot of debt.
2. Loans between $300 and $1500. You can repay easily because of the low amount.
3. Private application. There is complicated paperwork with traditional loans. It can take weeks and even months. With payday loans, you can apply online from the privacy of your home. Nobody has to know that you are a little short of cash.
4. Save time – A payday loan is the best option when you cannot wait in an emergency. All you have to do is just submit basic information (your name, physical and email address, phone number, monthly income, and social security number) and complete the application online or offline. Application processing and approval is usually over within the next 2-3 business days. You don’t want delays in an emergency.
5. There are no mortgages or guarantors in payday loans.
6. The lending agency won’t ever ask you why you need the money.
7. You pay back much less towards the interest and fees, as the loan amount is small and the time duration is just for a few weeks.
8. You can take multiple loans in a year, but not at the same time.
9. There are restrictions on the interest rate and fees, so you never pay back a lot of money. Your burden is always limited.
10. There are industry watchdogs and regulators always looking at the lending agencies, working in your best interests. So you are always protected.
We need loans sometimes. There is nothing wrong in borrowing money, but make a conscious effort to avoid long-term debt. If you need a short-term loan, consider payday lending. Millions of people in the United States are taking payday loans, paying back their debt, and solving their immediate cash flow situations or emergencies. It’s a great way to finance your requirements.