Payday loans are short term loans that are secured by your paycheck instead of property or your reputation in the form of your credit score. Here are the top ten secrets to getting an online payday loan.
Verify that the Lender Is Legitimate Before You Apply
Too many scammers pose as payday lenders online in order to collect your personal information. Do your research about legitimate lenders offering payday loans in Australia. You can’t afford to be a victim of identity theft on top of the financial emergency leading you to request a payday loan. And you’ll be rejected if you try to apply for an American payday loan because you didn’t verify that the lender was in Australia. Check their physical address. Know what their phone number is.
Know the Red Flags
Suppose you’ve sent in your application. Know what constitutes a red flag, so that you don’t get ripped off. Any lender who demands money in advance is a scammer. You shouldn’t have to pay taxes or application fees on a payday loan. They charge high interest rates to offset these costs. Anyone who demands repayment in gift cards is a scammer.
Know the Rules Before You Apply
Don’t apply for a larger loan than the lender will offer. Don’t ask for a longer loan term than what they’ll allow. In short, read the rules the lender mandates and don’t waste time requesting loan terms they won’t accept.
Most people know about the benefits of shopping around for a lower interest rate on their home loan or car loan. Yet they go for the first online payday lender they find, as long as it doesn’t generate any major red flags. Stop, and then start shopping around. Payday lenders can vary wildly in the interest rates they charge. Consider finding lenders who allow you to rollover the loan for a relatively low fee, if you may not be able to pay it off.
Be Realistic in Your Request
Don’t request more money than you can realistically pay back with your next pay check. This prevents you from being caught in a debt spiral. And if you ask for more money than they think you can repay, your loan application is likely to be rejected.
Fill In Everything on the Application
Failing to fill in every field on an application can result in your loan being rejected. For example, you should fill in the name and address of your employer even if that information is on your pay stub. Leave this off, and their online application may sit waiting manual review or be automatically rejected.
If you put down a fake phone number or make up an address to try to fool debt collectors, they may refuse to extend a loan. If your contact information doesn’t match that on your driver’s license, the application will be rejected due to anti-fraud measures. Don’t lie about the number of hours you work or your hourly wage.
Plan How You’ll Pay It Off Immediately
A pay day lender will generally give you the money within 24 hours. Some promise to send you the money within 30 minutes. Start figuring out know how you’ll pay it off as soon as you receive it. What can you sell to raise cash to pay the interest and fees off? Can you work an extra shift at work? The goal is to pay off the loan in full when it comes due. Payday loans already have high interest rates. The fees and interest charged on a rolled over loan can total up to more than what you initially borrowed.
Know How You Can Minimize the Costs
Payday loans come with steep fees and high interest rates. However, you may be able to get a lower interest rate if you allow them to sweep your checking account for the amount due instead of giving them a post-dated check. Ensure that you have enough money in the checking account to cover the loan plus any other debits to the account, because you don’t want to be hit with fees because a transaction was declined.
Research the Alternatives
Can you take out an installment loan instead of a payday loan? This generally has a high interest rate, too, but you won’t be hit with high fees because you can’t pay off the loan with your next paycheck. Can you borrow from friends and family? Researching these alternatives allows you to avoid a payday loan and know how you can pay it off without rolling over the loan with the same lender.