Pay day loans, also known as fast cash advances, are short term loans with the borrowers next pay day as security. The only criteria that is required of a borrower to have a loan granted is that they have proof of employment and pay check records. There are no credit checks and even an individual who has gone through bankruptcy will be accepted.

Are Fast Cash Advances Dear?

This type of lender is open to huge risks and studies have shown that they lose about 25% of their annual income from default. For this reason percentage rates are high. However, as the loan is only short term, usually no more than two weeks, these rates are not as bad as some people may have  borrowers believe. A $200 loan with a $30 (15%) charge is a reasonable fee over a short term even though it equates to an Annual Percentage Rate (APR) of 390%.  Those against payday loans will use this as an argument. The fact is the loan is only over two weeks, not twelve months and really is a cheap, convenient way out of a short term financial hole.

How To Get A Fast Cash Advance

Different companies have varying application requirements. Some will require proof of income through bank statements or pay receipts while others will simply take a persons word for it. Apart from that, borrowers will only need to fill out an application form.

There are many pay day loan shops and most pawn brokers also provide them. It will usually entail leaving a post dated check for the amount of the loan plus the lenders fee. If the borrower doesn’t return and repay the loan the check is simply cashed on the agreed day.

Now, with the advent of online fast cash advance loans the process is even more simplified. There are literally thousands of avenues to access these kind of loans. It can take a matter of minutes to apply and the money can be in the applicants bank account in hours.

Dangers of A Fast Cash Advance

The biggest danger of payday loans is not repaying the debt immediately. That $30 fee on a $200 loan over two weeks is usually easily managed and will get a person out of a short term tight spot. When the borrower starts rolling over that loan, then the danger begins. The longer it takes to repay the higher the interest becomes until after twelve months it reaches that 390%.

A Fast Cash Advance is dangerous if individuals aren’t diligent in managing them. Many people will warn against taking them out however, the best person to know a persons capability is the person themselves. Like anything, if they can’t afford to repay, don’t borrow.