No checking account loan
Loan is not necessarily a bad word, in fact in times of need it is actually a very welcome recourse. Generally speaking the word conjures up images of big amounts of debt incurred to either buy a house or a car. But, that is not everything. Haven't we all been in situations of financial exigencies where a small amount of cash is all we require to tide over unforeseen situations? Maybe the car needs a new battery or the garage needs a new shed. Maybe there are some repairs to the house that can be postponed no longer or some medical expenses have come up that has to be met immediately. In such cases you need a little money to tide over the situation and can easily repay it once your paycheck arrives. A small loan can meet this requirement. What has been the recourse for a person with little or no savings faced with such situations ? The only option at such times seems to be requesting a friend or relative to advance some money. But these days where do you find friends or relatives willing to do so ? Haven't we all wished at such times there was some institutional recourse ? Some organization that we can approach without any obligation and at a price the organization would bail us out ? Well, this is where the concept of payday loan comes in. You get immediate cash to meet the exigency as the lender forwards the money to you (generally less than $1000) and will wait for you to refund the sum once your next paycheck comes in. It is a quick and easy transaction requiring very few formalities. These Payday loans are intended to bridge the borrower's cash flow gap between Paydays. Typically theses loans are paid back by the borrower out of their next pay check or any other regular income source. Here you get the money easily and as easily you can pay it back also.
Payday lenders are not difficult to find, with internet lenders available to meet your requirements. A simple online application form can be filled up and the loan gets credited to your bank account directly. The time and energy required to do the rounds of bankers is also evaded; sitting at home with an internet connection one can easily perform all the formalities. What can be easier?
Changes No Checking Account
Initially the only trouble with such payday loans was that you needed a checking account. However recently the trend has changed and a person with no checking account can also get loan. A verifiable income is often the only requirement for a person to be eligible for such loans. Earlier a checking account was insisted on so that the lender could ensure that the depositing of the money and also the withdrawal of the same can be done without any problems. Obviously a large group of people were thus excluded from the list of potential customers as people with no checking account were not eligible. Also perhaps the neediest group of customers were not benefiting from this service. A business must evolve with time and changing circumstances. This is what happened with the business of payday lenders. In order to increase their client base they have done away with the requirement of the person having a checking account. Today a savings account is considered enough and in some cases just a simple statement assuring a verifiable income source will also do. There are some lenders who are not even bothered with the debtor's bad credit history. People with bad credit history who had no recourse to the lending system, today have an avenue to meet their immediate requirement for funds. This may be sounding too good to be true! But obviously it comes at a price. Such loans are quite expensive and should b taken only when it is really necessary. One should not get into the habit of such loans; it will turn out to be an expensive habit!
There is a trend recently of all the big lenders entering the business of No checking Account Payday Loans. The advantages of quick and easy returns on these loans have attracted the big names in the business. The loan amounts are small so the exposure of the lenders is limited. As far as the clientele is concerned they are attracted by the promise of no requirement of a checking account, where a simple savings account or even just a statement ensuring verifiable income will meet the requirements.
Such loans however have their fair share of controversy."> Since the main target group of customers is people with little or no savings and these loans are typically very expensive, a majority of the borrowers get into a debt cycle by ending up rolling over the loans and each time bearing the associated costs. For the lender such loans provide new avenues for growth but come with significant risks too. Higher margins are received at a higher risk. Critics often point out the fact that the lenders target the poor and the young who more often than not are not equipped to understand the associated high costs. The fact that such loans are easily available, require little documentation and the obligation of a checking account is also not there, lures them into taking such loans without properly understanding what they are entering into. However as in every business it is 'Caveat Emptor' and the borrower must use his judgment before contracting such a loan.