Taking out a 1000 payday loan can be much easier than you would ever think it would be. With the advent of the payday / cash advance loan industry even those who don’t have good credit now have access to capital in a very quick, efficient manner. However, there are a few key points that one must remember before they try to take out 1000 or a 3000 loan from a payday lender.
First, remember what the requirements are for taking out such a loan. While not hard to get, it is an absolute must that you have 1) a bank checking account, and 2) a job. While it would be nice if they offered people without a checking account a loan option, that really doesn’t work for a payday loan simply because of the fact that in order to secure the loan you have to write them a post-dated check. These loans are short-term loans (one to two weeks is all), and that is how the company manages the cash flow–so there is no way to get such a loan without the checking account.
Second, you need to remember how much these loans cost. If you look at average costs around the country, they are very high. In terms of origination fees, you can expect to pay somewhere around 15% – 17% of the value of the loan, plus interest expense (which can come out to be above 400% APR). You will add these amounts to the value of the loan, then write the post-dated check for that amount.
Because the costs of payday loans are so high, it’s very important to remember that this type of financing is meant primarily to function as a short-term financing option. Do not use such loans as equity lines of credit, and do not take them out unless necessary – otherwise you will never find yourself in a healthy financial position and will always be living from paycheck to paycheck.
