The pros and cons of payday loan

Often payday loans are warily looked upon by people because they think it is a predatory form of lending. However, like many other financial practices, there are certain costs to it, but benefits to be gained from it as well. And while a payday loan may not be for everybody, there are particular groups of people who will be able to benefit a lot from getting one. And for you to decide whether or not it could be something that you can take advantage of, you will have to consider both the pros and cons of a payday loan. Compare payday and other loans in Norway using this link.

Pros of a payday loan

The first main advantage of getting a payday loan is that it is so easy to get. The requirements for getting one are very lax. You will only need to be 18 years old in most countries, have a checking account, and also have a monthly income as well.

Another advantage of payday loans is that they are very fast! In a lot of cases, you can get your loan in as much as under an hour, depending on the amount that you are borrowing. And it would only take at a maximum of 2 to 3 days to get your loan approved.

Finally, they are convenient to get as well. In addition to having low requirements and a fast approval time, you can even get them from online lenders as well. So a payday loan could be a convenient source of cash for you.

Cons of a payday loan

One disadvantage of a payday loan is the high interest rates attached to them. You may even be charged as much as 30% interest rate, depending on repayment options. However, you can avoid high-interest rates if you choose your lending company carefully.

The short time that you are required to pay back the loan is also constrictive for some people. Most payday loan lending companies will require that you pay back the amount you borrowed in as little as thirty days. Although that can also be flexible depending on the repayment options that you choose.

Another disadvantage is that if you do not have a job, you are not eligible for one. People who are unemployed will not be able to apply for a payday loan, no matter how hard they will negotiate. You will need to show proof of employment, or at least income if you would like to apply for a loan.

As you can see for yourself, there are both distinct advantages and disadvantages to getting a payday loan. You will have to decide for yourself whether getting one would be something that is right for you. For a vast majority of people who need money fast, to pay off debt or bills, getting a payday loan is something that is more advantageous to them. And it might be for you as well if you weight in all of the costs and benefits of it. If you ever find yourself in a dire situation, wherein you need cash, try to look for a lending company that offers payday loans.