« Refinance Car Loan | Main | Bad Credit Car Loans »
Fast Cash
“Fast Cash” might sound like someone’s fondest wish, but really it’s a short-term, unsecured loan, aimed at those who need immediate funds to cover unexpected costs. Other common names for fast cash advances are “Check Loans,” “Payroll Advances,” “Payday Advances,” “Cash Now Advances,” or “Quick Cash Advances.” But no matter what you call it, the process is the same: borrowers fill out an application detailing some basic personal, financial and employment information, provide the lender with a post-dated check to be cashed when their next paycheck arrives, and lender hands over the cash advance—in most cases within twenty-four hours.
What makes fast cash attractive to many borrowers is the ease with which it can be obtained. A borrower can either go to a check casher or apply online for a fast cash advance, fill out the application, write the post dated check, and leave with cash in hand. As it is an unsecured loan, there are no background or credit checks required. The funds can also be deposited directly in (and later repaid from,) a borrower’s bank account, meaning that you only have to go as far as your computer to obtain the fast cash you need. If you know you are short on rent, or have a sudden expense that must be covered immediately, a fast cash advance will help you out of a tight spot.
However, there are some pitfalls to watch out for. Fast cash advances are generally small; $300-$1,500 is all most lenders are willing to shill out on such a high-risk loan. The advance also has an extremely short repayment period—usually 14-30 days, or however long until a borrower’s next paycheck arrives. These types of advances also have extremely high interest and annual percentage rates (APR), meaning that a borrower will have to pay back more than they borrow, simply for the convenience of obtaining fast cash. If a borrower fails to repay a fast cash advance when his next paycheck arrives, it gets rolled over into the next pay period, and all service fees, interest rates and APR get factored in a second time. Since there is no real legal restriction as to how high a service fee can be applied to fast cash advances, after just one or two defaults, a borrower can end up in a worse hole than he was in before.
If you know that you need fast cash, be sure that your next paycheck will cover the cost of the advance and all applicable fees. Never borrow more than you need to cover the immediate expense, and never take out a second advance on top of one you have not repaid. If you still need money after obtaining a fast cash advance, seek other options. Whenever you apply, make sure you mark down the cost of the advance in your checking ledger immediately after you hand that post-dated check to the lender. Never let sloppy math put you in a hole of debt.
Finally, if you’ve already exercised your fast cash option, budget your next paycheck accordingly. It is better to have to scrape your way through one reduced paycheck, than it is to have scrape your way through many down the line, when the cost of your fast cash advance has multiplied several times over. Fast cash can be a blessing, but only if you use it wisely.
Topics: Payday Loans |
