Advance Cash Loans

Possibly one of the most controversial and talked-about topics in the lending world is the subject of advance cash loans, also known as payday advance loans. What are they? What are their pros and cons? How convenient are they? Are they worth it?

Convenient and easy. The biggest draw of these advance cash loans is the convenience and ease in terms of access and application. Lending companies that offer these kinds of packages are a dime a dozen online that it has become difficult to weed out the legitimate deals from the scammers.

Compared to regular bank loans, processing is easier and faster because of the fewer requirements. Borrowers don’t even need to pay a visit to the bank as the application can be lodged online. The money is released within 24 – 48 hours, a big advantage if you need the funds in the case of an emergency or an urgent expense.

Low credit score? It’s okay. Advance cash loans are also a popular and common choice among those with less than stellar credit scores that prevent them from getting regular bank loans. Many companies advertise that they don’t do credit score verification, although financial experts still maintain that some level of verification is done. Still, the credit score is not a big requirement to get approval of the application as these loans are primarily designed for those with low credit rating.

Exorbitant interest rates. A trade-off for the convenience and ease of these advance cash loans are the high interest rates. Some lenders are known to charge as high as 20 percent interest, which can be a big drain on your finances especially if you fail to pay the loaned amount on the due date.

Short repayment terms. Short repayment terms can either be good or bad, depending on your financial capacity. Generally, it is always better to pay off a loan the soonest possible time in order to save up on future interest charges and penalties. However, with a shorter repayment period, you would also need to have saved up enough cash to pay the loan in full on the due date if you wish to save on interest. This can be a challenge if your monthly or fortnightly pay is low and you need to set aside funds for your regular monthly expenditures.

A smart rule of thumb when it comes to advance cash loans is to compare the gains and risks with your other options for getting funds. Some options offer the same gains but with lower risks.