Cash Loan
Cash loans are an option when you are left with no other alternative but to take a loan. This type of loan is usually for a short period of time and is an instant source of money to a borrower. Usually for a period of 30 days or till your next salary day, this type of loan has become quite popular due to its instant availability. You are simply not judged based on the credit score like the banks do. When your poor financial condition which may not be a result of your fault , such loans could be of help even with a bad credit.
Do Your Homework Well
But before going ahead with a lender, keep certain things in mind and compare the different availability option. Make sure to recheck your present financial condition considering the repayment of such loans, which is going to be for a very short period of time. So while the search is on, consider these following points.
1)The total amount you are going to borrow.
2)The interest rate at which it will be repaid.
3)The total duration for which the money is borrowed.
What is the fee?
The lenders are immensely benefitted sanctioning this type of loan. The profit margin is double. There is no bar in the interest rates and subsequently, the loans are granted at a very high rate. Secondly, the fees that you give initially, also becomes a source of income.
What Happens If You Don’t Pay the Money?
In case of payments not made on time, an extension of time period is given, say, for two more weeks but at the cost of giving another fee. Your loan gets “rolled over” and over a period of time, if the same thing persists, you will end up having a good amount to return, which is actually very difficult to pay. The combination of increased interest rates and payment fee at every level doubles or triples your borrowed money over the period of time. Let us see this calculation with the example below. Say, for taking a loan amounting to Rs. 10000, you pay a fee of Rs 1500 for duration of 2 weeks. After a period, you are again unable to repay the amount. So again you pay the fee of Rs 100 and rollover the borrowed amount again. This way the process will go on and finally you end up paying more that the borrowed amount as fees. Keep in mind that, you still have to pay the borrowed amount.
How to Compare Cost?
Most loans are granted on the basis of an Annual Percentage Rate (APR). APR is usually the calculated money that costs you to borrow the loan for duration of 1 year. In cash loans, the APR is usually very high. Well, when you apply or get a loan, the lender must tell you the APR and the cost of the total loan amount at the end of the repayment duration. While it is an easy solution to obtain this type of loan and that too without a credit check, make sure that you have already walked into other options before settling down with this type of loan. But do a prior calculation to keep you financially afloat during paychecks period.
How to Apply
Payday loans are easy to apply and you don’t need to worry about multiple formalities since the company handles it all. The best part about payday loans is that it is a short term loan and once you have the money ready to pay it back you don’t have to wait. This loan can be paid back within a few days or weeks depending on the emergency and requirement. If you thought that the interest rates were high, try comparing it to any other personal loan and you will soon figure out that this is the most cost effective loan that you can opt in for.
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