Instant Cash Loan
You see the advertisements on television and hear them on the radio. You might even drive past a few of these instant cash loan merchants on your way to work or the local grocery store. The ads promote these instant cash loans as a way to get yourself out of a jam until your next payday. Just how helpful are these swiftly-obtained loans?
What makes instant cash loans so attractive to consumers is the ease and quickness with which you can obtain them. You can simply walk into one of the establishments and walk out with the cash you need within just a few minutes. There are no credit or background checks. Often you only need to provide verification that you have a valid checking account and a verifiable source of income.
Instant cash loans are certainly more appealing than traditional bank loans which require up to a week and a somewhat strenuous process for approval. When you have a financial emergency the last thing you want is additional hassle.
Obtaining an instant cash loan is as simple as writing a check - literally. You write a check to the lender in the amount of the loan plus any applicable fees and the lender gives you the cash you need.
The advertisements paint a charming picture of instant cash loans. These ads, however, don’t always include all the details about the loans. Once you obtain the loan, you generally have less than a month to repay it in full. In most cases, the maturity of the loan is 14 days. If you haven’t repaid the loan before the due date, the merchant will cash your check.
Financial binds aren’t always resolved in as short a time as two weeks. What if you don’t have the funds available in your checking account at that time? Not only are you subject to overdraft charges from the bank, the lender will likely charge you late fees and well as check handling fees, as permitted by the laws in your state.
Most, if not all, instant cash loan establishments will allow you to extend your loan for another period. The catch is that at the next maturity date you will owe double what you owed before, if not more. This is because instant cash loans have an interest rate of 300% or more. This high interest rate makes it easy to fall into a debt trap.
An instant cash loan is a viable solution only if you have the ability to repay within the agreed time frame.
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