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What are Emergency Payday Loans?

  • by Joseph Priebe|
  • 0 Comment |
  • Updated: August 23, 2022 |
  • Loans

Learn how to get emergency payday loans

A financial emergency can happen to anyone. Did you know 40% of Americans could be pushed into debt by a $1,000 unexpected expense? Emergency payday loans are a great solution to cover unexpected car repairs, medical bills, or to cover your rent or mortgage. 

What Does an Emergency Payday Loan Entail?

An emergency payday loan is a short-term loan option for people dealing with any unexpected financial difficulties. Emergency payday loans for bad credit can help during the tough moments of your life, regardless of your credit. 

Also, you can get these loans from direct lenders, online lenders, and payday loan companies. You'll have a wide range of options that can be explored to take you through your financial hardships.

How Much Can I Get from an Emergency Payday Loan?

There is no nationwide standard amount that can be received for emergency payday loans. Each state decides how much can be borrowed, make inquiries about the maximum amount you can get in your state. The maximum loan amounts range from $100 to $5,000, with other factors deciding how much you can get. If you live in a state that does not allow payday loans, you'll need to consider different loan options.

What Are the Benefits of an Emergency Payday Loan?

Although a payday loan might have some downsides, it has a few benefits that may make it a viable loan option. Here are some significant advantages of payday loans over some other loans:

• It usually has a simple and secure application process that ensures that borrowers do not go through much hassle before getting loans.

• It can be a better alternative than obtaining loans from banks and other conventional financial institutions. Most of these institutions have stringent requirements and application processes that may require a longer approval time.

• You can get a loan within a few hours to some days after applying for a loan. In fact, you can get an immediate response on whether your application is accepted or not even on bank holidays.

How Does an Emergency Payday Loan Affect My Credit Score?

If you're getting a loan, it's vital for you to be aware of the effects on your credit. There is no straightforward answer to this question because different emergency loan lenders have varying processes and requirements. Some companies will verify your credit score to determine your ability to pay back the loan. Other lenders will not do so but instead, use different databases to calculate your ability to repay the loan.

When you get an emergency payday loan, your payments may play a key role in determining its effects on your credit. For instance, if you default on your loan, this will ensure that a report is sent to the credit bureaus. Having an account in collections will leave a big dent in your credit score and leave you in a worse financial situation. You're advised to avoid taking an emergency loan if you do not have the certainty of paying it back.

What Are the Different Types of Emergency Payday Loans Available?

Before applying for any emergency cash loan, take your time to understand a few things about the types of emergency loans available. 

• Same/next day crisis loans

This type of emergency loan allows you to get the cash you need on the same or next business day. Loans from traditional financial institutions may take days or weeks before getting approval for the loan.

In addition to helping you get the loan as quickly as possible, if your application is denied, you have time to consider other options. Crisis loans on the same day are beneficial to anyone looking for a fast bailout from any financial problems.

• Bad Credit Payday Loans

If you have bad credit, your last resort should be banks and other financial institutions as they will likely deny your application. However, you can take advantage of a bad credit payday loan because your credit score will not be considered.

• Cash advances and online payday loans

These two types of emergency payday loans work similarly. You can simply apply for the emergency loan online, submit the requirements, and get updates on the status of your application. When your application is approved, you can get the loan as soon as possible. 

Who Can Get an Emergency Payday Loan?

There is no fast rule about who can get an emergency payday loan. Each lender has the authority to decide who qualifies and who does not. While some may do a credit check, others use alternate methods to determine whether you'll be able to repay the loan.

However, when applying for an emergency loan, the borrower must satisfy the following requirements:

• Be at least 18 years of age

• Be a permanent resident of the USA or a US citizen

• Have a source of income you can verify or be currently employed for a minimum of 90 days

• Have a monthly salary of $1,000 or more after taxes

• Must not be an active military officer

• Have a Social Security tax ID as well as a valid government-issued ID

• Have a valid email address and a cellphone/home phone number

• Own an active bank account where the lender will send the funds

Please keep in mind that these requirements vary from state to state and are requirements for new customers.

Where Can I Get an Emergency Payday Loan?

Here's where you can get this type of loan:

• Direct payday lenders

You can get emergency payday loans from a direct lender. Most direct lenders offer some of the best terms and rates. Many of these lenders can provide the funds you need within the hour. 

• Payday loan stores

Payday loan stores are conveniently located across the country, so you have no problem getting one that can provide the loan you need. Their loan application processes are usually easy too. You'll need to submit an application form for the loan and wait for the approval. 

If approved, sometimes a post-dated check will be required by the store, and you'll be reimbursed immediately. You must remember that if the check cannot cover the loan, your bank will charge you additional NSF fees.

• Online payday lenders

Online loan lenders are other options you can consider when getting an emergency payday loan. Be aware of extra charges and hidden fees that may put you in a worse financial situation. 

Similarly, some are third-party lenders between real lenders and borrowers. Therefore, you need to verify the authenticity of a lender before filling out their online application.

Tips to Avoid Pitfalls When Getting an Emergency Payday Loan

• Stick to the agreed repayment term. Failure to do so may increase the interest rate and affect your credit score.

• Only borrow the amount you are confident that you'll be able to pay back on or before the agreed repayment schedule.

• Have a full understanding of the interest rates and all charges that the loan attracts.

• Take your time to research about various lenders before deciding to use one.

• Do not sign the loan agreement until you have fully understood all of the terms and conditions. If you have any doubt about the contract, make inquiries from the lender, and get a convincing answer.

• Avoid providing false information when applying for a loan. Submitting incorrect information is illegal, and you could be subjected to fines or other forms of punishment.

An emergency payday loan is an excellent option for anyone in search of fast financial relief. However, like other loan options, it has certain drawbacks. Therefore, understand the long term economic consequences of your actions before applying for the loan.

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