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1000 Loan Payday - A 1000 Dollar Payday Loan Comes with a Steep Price - Pros of a $1000 Payday Loan

The Pros and Cons of Cash Advance Loans

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If you have an email account or spend any amount of time surfing on the web, you have likely come across the ads that promise you a quick $1000 loan before payday with no credit checks. These payday loans may provide the much-needed cash in emergency situations, but this cash does not come without its pitfalls and disadvantages.

Payday loans work by proving you have a reliable source of regular income from an employer. Your employment is the first guarantee that allows the lender to give you the money without a credit check. The other guarantee is that you must have a valid checking account. At walk-in locations, you must write them a check in the amount of the loan plus the fee, sign it, and hand it over. In the case of online $1000 payday loan operators, you must provide the routing number and account number of your bank so they can create an electronic check.

Once all the information is provided and accepted, the loan is handed over either as cash or it is delivered to your bank account electronically by the next business day. To receive the $1000 loan, payday must be within 14 days. The advertised $1000 payday loan is not guaranteed to all customers. This is simply the maximum amount of loan they will give. The actual amount varies by income and is also determined by whether you are a first-time customer or a regular. While these loans can be a lifesaver in limited emergency situations where no other form of cash or credit is available, they carry a high fee set as an annual percentage rate (APR).

Pros of a $1000 Payday Loan

A payday loan can be very helpful in extreme emergencies. Here are some of the benefits of taking out a payday loan:

• Cash advance loans are fast. Applications take only a couple of minutes to complete. If you have previously used the company, it can take even less time, as they store your information in the computer system.

• Loans are available to everyone with regular income, regardless of credit.

• The only verification needed is a valid checking account with a positive balance, valid government-issued ID, and a paystub for proof of employment and income.

• Cash is given within minutes, hours, or by the next day, depending on which lender is used. This can be helpful in cases such as unexpected car breakdowns or medical emergencies.

• Lenders are usually available close to home and some operate 7 days/week. Lenders are also available online.

Cons of a $1000 Payday Loan

Taking out a payday loan has several disadvantages and are not recommended to be used as a regular financing tool. Here are the reasons to be careful about or avoid payday loans:

• Payday loans are expensive. The fees for a payday loan averages at $15 per $100 of the loan. The exact fees vary by state. Because the term of the loan is less than two weeks, this works out to an annual percentage rate (APR) of 500% to 1000%. In comparison, the APR of most credit cards is 20% or less.

• Payday loans can lead to unending piggybacking. Many people who take out a payday loan find that after they pay off the previous loan, they do not have enough money left over to make it to their next payday, so a cycle of loans begins that can continue for months or even years, draining you of your hard-earned money.

• Payday loans have been made illegal in some states in order to protect consumers.

• If not repaid on time, lenders can apply additional fees, collection costs, and can report the default to credit bureaus and sometimes the police.

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