The payday loans are considered as short term debts and are often referred to as cash advances. The intention of the loan is that this will be paid when the next paycheck and salary come in. This would mean that the debtor will have an obligation during the next paycheck. Most of the time, financial advisors would advise people against borrowing from the payday loan lenders. If you happen to find an alternative source of funds that can provide you with money, then you can avail of the option before taking out a payday deal. This way, you get to avoid the high annual percentage rates that lenders charge the debt with. For those that are simply desperate and want to have the money, then they prefer the payday debt as their only resolution.
The next question would be how to access the funds. Generally, there are two simple ways to apply for the cash from these lenders. The first method to apply for the loan is considered as the traditional way of applying for it. This is referred to as the retail lending process. Most of the lending institutions that offer this product are not part of any banking company. For this reason, this is what separates these lenders from the loans offered in the banks. The retail lender would usually be situated in a store where the borrower would have to go to. These lenders would usually ask for a postdated check that would be the collateral for the funds loaned to the borrower.
The process of the retail lending further states that when the loan comes into maturity, the borrower is obligated to return to the store to claim the check and pay with cash. In cases the borrower does not return, the lender will deposit the check or cast it at the bank. The borrower is as well requested to provide proof of income in the form of pay stubs and current bank statements. The second method, and currently the more popular one, is the internet lending. The lenders on this process would boast of quick and fast approval with the funds directly deposited to your bank account in just one hour.
These lending processes are usually paid during maturity by simply electronically debiting your bank account for the payment of the funds. The borrower is normally requested to fax check stubs, bank statements and social security number to provide proof of identity and address to the lender.