Payday loans are short-term loans with a higher interest rate that is to be paid within two weeks or a month depending upon the agreed terms. Payday loans are different from traditional loans in the sense that they are lent irrespective of the credit score of the borrower, and to sanction a payday loan, an individual only needs some valid id proof, an active bank account, and a source of income proof. Payday loans are sanctioned within minutes and the money can be obtained within twenty-four hours. Experts consider payday loans as predatory loans as they tend to trap people in more debt. Payday loans are obtained by people who don’t have sufficient funds to carry out their monthly requirements or are in desperate need of money. Experts suggest that people should look for other alternatives if they require money, however, if people have no other option apart from payday loans then they should stick to amounts that their income can sustain. If you want to know more about payday loans, check out

The following is a list of things that you should know about payday loans

Easily accessible

Payday loans are easily accessible. They do not require much paperwork like traditional loans. All you need is some id proofs, an active bank account, and a source of income proof. After this verification, the lender will lend you money within twenty-four hours. An advance check with the due date of repayment is taken as security.

High-Interest Rate

The interest rate on payday loans might seem simple but they are high given the fact that the borrowed amount is small (typically from $500 to $1500) and the borrowed duration is also smaller than other types of loans. Generally, the interest rate is around 25% of every $100 borrowed.

Advance cheque

As a security, the lender will like to have an advance cheque with the due date of repayment, the amount on the check will be inclusive of the borrowed amount and the interest amount. In case you are unable to repay, then you can extend the time duration but with the same interest rate every time.

Payday loans are easily accessible high-interest rate loans that require an advance cheque as security. The inability to repay on time can start a pattern where you will end up paying more interest amounts than your borrowed amount.

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