What Do I Need to Get A Payday Loan
In Australia, payday loans have become increasingly popular in the last few years, with number of lenders in the market offering these short-term loans. Before applying for any type of loan, it is important to understand how actually it works. Not all lenders offering these loans have the same eligibility requirements and application processes. Generally, the application procedure of payday loan is absolutely simple and quick.
The very first step is to compare the lenders so that you can make the right choices. Make sure you review the loan amount, fee and loan term so that you can ensure you are applying for a loan that meets your requirements. Next, you should review the eligibility criteria and required documents as not all lenders may not have the same application criteria. Usually, you need to be above 18 years, have a regular income and a bank account. You should also check what level of bad credit the lender will accept. Some lenders may also ask for your last 90 days of bank statements and employment and financial information.
Within minutes, lender will inform you if your loan application was approved. If more information is needed, lender will contact you. When you are approved, you need to agree to the contract set by the lender. It is recommended that you carefully review the contract and check out the terms, conditions and fee. Contact your lender, if you have any question about the contract.
You can receive the fund right into your bank account on the same day or within one business day. The time taken to get the cash deposited into your bank account will depend on your bank and when your loan was approved.
Understanding about payday loan will help you to find out if they are the right type of loan for you. Payday loans are short term loans. An amount between AU$100 and AU$1,000 can be borrowed for a term of 15 to 30 days. These loans are designed to be paid back when you next get paid. Since the amount you are lent is small, you are offered short term to repay it back.
The fee cap for payday loans set by the Australian government as on 1st July 2013 are as follows-
- You will be charge a 20% establishment fee based on the amount loaned
- A monthly fee of 4% of the principal loan amount
- All applicable government fees and charges
- Additional fees or charges if you default on the loan
Since payday loans are short term and the repayment is structured around your next payday, the qualifying criteria seem to be a bit more flexible. Though, you should keep in mind that the lending criteria may differ. Most payday lenders will be concerned more about your ability to pay back the loan rather than your past credit history. Thus, they will focus more on your income and your financial activity compared to the credit mistakes that you have made in the past.
There are some payday lenders who may carry out credit checks. Such lenders will usually outline about such procedure on their website. Unfortunately, there may be many lenders who might prey on people with poor credit and charge high interest rates. But there are several reputable lenders who will offer you genuine help in finding the right payday loan deal.
Most payday loans lenders operate online. So, it will be easy for you to judge their reputability. You can check out their website to see how transparent they are with their fee and payment structure and how easy they are to reach. You can also go through the third-party customer reviews to know others experiences with them.