How do they work and are they good
Financial emergencies are inevitable. When you suddenly need extra money and can’t wait several days to process a bank loan, what will you do?
This is what makes fast same day loans Very important.
You receive the money the same day you request it, as the name suggests. Unfortunately, the loan has a higher cost than other types of loan.
If you’ve explored your loan options and are wondering if you should consider a same-day loan, this article is for you. You will learn everything you need to know about the same day loan.
Let’s start with its meaning.
What is a same day loan?
It is a loan disbursed the day you apply for it. Although you like to receive the requested amount on the same day, you will have to dig deeper into your pockets when repaying.
For example, you might find that the Annual Percentage Rate (APR) same day loan is 400%, while other types of loan have an average of 9.58%.
By comparing the two, you can choose to wait days but take advantage of a cheaper option. But in an emergency, loans with lengthy procedures cannot help you. Same day loans are helpful in such situations.
If this is your first time considering a same day loan, you might be wondering how it works. It is essential to note that same day loans are of different types.
To understand how they work, you need to know the different types.
Types of same-day loans
â¢ Car title loans
This is a loan granted against the title of your car. In the event of default, the lender sells or repossesses your vehicle. The process does not involve leaving your vehicle with the lender. You still use it during the term of the loan. The only problem is when you’re default.
Most car title lenders do not require a credit check to approve the loan. The title is sufficient security for the loan. Also, same day loans involve small sums.
Also, due to the costs involved, such as finance charges, the lender may disburse less than you requested after deducting them. If you need the exact amount, it may change your budget.
â¢ Payday loans
These are loans offered against your next payday. You can either walk into the lender’s premises or apply online. The application procedure is concise and the requirements are less.
After verifying your details, the lender may ask you for information or documents. What they ask depends on the specific lender. For example, some may require your bank details or a blank check. What follows next is the disbursement of your money in a short period of time.
Payday loans have a short repayment period. The lender can deduct the loan and any incurred fees from your bank account immediately after your paycheck is due.
What’s awesome about a payday loan is that you can get it even if you have bad credit. Interest paid on borrowed money depends on various lenders.
Some may have a flat fee for the full amount or a certain percentage for a specific amount. For example, 10% interest for every Â£100 borrowed. If you apply for a Â£200 payday loan, you will pay it back with 20% interest.
â¢ Cash advance by credit card
Maybe you have a credit card, but you can’t use it to pay a bill or request money instantly, and you don’t know what to do. In such a case, you don’t need to panic.
Simply walk into your financial institution and get a cash advance with your credit card. Alternatively, if your card has a PIN, go to the nearest ATM and withdraw the cash advance.
The only problem with a credit card cash advance is that it requires an upfront fee. For example, your account must have 5% of the amount you wish to take as an advance. The lenders deduct the amount when you receive the cash advance.
If you don’t have money to cover these charges in your account, you’ll need to deposit it first or pay at your bank’s counter.
If you have a valuable item like an electronic device or jewelry, you can get a same day loan. All you have to do is give this item to the lender as collateral. This form of credit is called pawnbroking.
The pawnbroker does not own your valuables. He keeps it until you settle your debt. But they may refuse to return it to get their money back if you don’t refund it.
All same day loans are expensive. But are they worth it? The answer is yes. Here are the advantages of the same day loan.
Benefits of Same Day Loan
â¢ Fast processing
If you are in a rush to get money, you will need to borrow a loan which takes less time to process. Same-day loan processing and disbursement takes place on the same day, making it the fastest processing time.
You will know in no time if you are eligible for the loan. Otherwise, you still have time to look for options during the day.
Same-day loans are more flexible than other types. You can receive the loan the same day to pay on terms that suit you. For example, you choose the period to be repaid.
â¢ Favors people with bad credit
It is impossible to obtain a loan from a financial institution when you have a bad credit record. But it is possible with same day loans. That is why they charge a very high rate of interest to cover these risks.
â¢ Easy management
Most same day loans have an online platform. You can easily borrow or repay through your online account. It helps you manage and control your online account activities. You can know essential details such as your loan balance or when to pay it.
Same day loans are essential for anyone. As illustrated above, they have many advantages. Their processing is also very quick and easy with few requirements. The same day loan is the best option if you need instant cash.