Advantages and Disadvantages of Fast Cash Loans

A quick cash loan is a type of loan that is given by a payday loan lender to a borrower who has immediate need for fairly small money. The amount of money that is allowed to be borrowed is anywhere between $100 and $2500, although some companies or private lenders might provide loans much lower than that. There are many issues regarding making quick cash loans. A lot of people are confused whether or not it will benefit them. The number of unsuccessful payday loan borrowers doesn't help one bit in relieving the  stress put on the quick cash loan option. To help you decide whether or not this type of loan is an opportunity or a definite no-no, the following article recounts the advantages and disadvantages of making this loan.

First of all, let's talk of the advantages. The good things in a payday loan or quick cash loan include immediacy, availability and the ease of approval. Even for bad credit borrowers, lenders don't close their doors and give out loans regardless of the risk that they are inviting into their business. For the borrowers' part, this is a clear advantage that must be taken into account when stuck in a financial bind.

The loan has very few requirements. A borrower is required only to bring photo identifications and any proof of past income. Sometimes, the borrower will be asked to provide excess information about him or herself, such as bank account numbers. This shouldn't be taken in a negative way. In fact, it should be seen as a good thing because the lender will use the bank account information to transfer the funds automatically once the loan is approved. As for repaying the debt, the funds are also automatically transferred to the lender's account once the promised paycheck comes in.

Since the reassurance needed is covered by the next monthly or biweekly salary of the person borrowing the money, quick cash loans are very safe for both the lender and the borrower. That is also the reason why lenders can give it without any long delay whatsoever.

Moving on, let us not discount the disadvantages. There are downsides to this loan, too. It should be noted, however, that the downsides are almost always caused by errors in judgment in part of the borrower. For instance, the principal amount may balloon to twice its amount. As a matter of fact, it can get up to tenfold the principal amount. The reason behind that is because the borrower can extend the loan for as long as he wants, provided that he is willing to pay the added late fees to the amount owed. Or, the borrower can roll over the loan and pay only the interest. This would be the same as paying the old loan and getting a new one. Just for the short span of time requested, the borrower is required to pay twice the interest rates. That doesn't yet include the processing fees.

Another disadvantage is the high interest rate. All fast cash loans have high interest rates. A borrower must balance the need and the interests when deciding whether or not to resort to fast cash loans.

How Can You Apply for a Fast Cash Advance?

Cash advance is an increasingly popular option for employees who live from paycheck to paycheck. Not only does it provide them with an immediate solution for their needs, but it also provides them with a guaranteed solution. It should be noted that in the world of loans, immediacy and guaranty are the two sides of the same coin.

Quick cash loans often refer to the type of payday loan that is only short term and has very high interests. That, in itself, makes borrowers a little cautious when it comes to applying for quick cash advance loans. A quick cash advance is a good solution for people needing small amounts of money in the least time possible. For instance, anything between $100 and $2500 can be considered as a quick cash loan.

Since the process of cash advance loans are fairly straightforward, borrowers can take the easy way with this type of loan. The requirements are kept at a minimum, while the restrictions are lessened, if not totally removed. That being said, the borrowers are left with great advantages, such as quick fixes for unexpected financial binds. An example of a tough  spot is an emergency. A person living from paycheck to paycheck typically doesn't have enough savings to afford emergency medical expenses, especially if that person doesn't have insurance. For that reason, the cash advance route is a great fall back solution.

Make no mistake, though. It doesn't mean that you should always depend on borrowing money when push comes to shove. The main reason that quick cash advance loans are painted in bad light is that people are not very successful in managing them. For instance, a person who had once tried lending as a solution for tight financial spots will tend to use it again. Or, a person who couldn't repay the first debt on time will just try to extend his loan, by paying the full amount and renewing the loan. In purview, he is only paying the interest rates.

To apply for a quick cash loan, a person must present a few requirements, still. The requirements would include photo identification, as well as proof of income. The proof of income is to reassure that lender that the borrower has the ability to repay the debt. Sometimes, for very specific types of quick cash loans, the lender will ask for the bank account information of the person borrowing the money. The advantage is that the money is wired directly to the borrower's bank account once the loan is approved. 

The disadvantage is that the payment is automatically deducted from his or her bank account, even if the borrower has no intention of paying. In theory, either case would be a win-win scenario because the borrower wouldn't have to worry about paying the debt at a later time, when the interests are higher. However, in practice, the borrower might need fast cash to fix more urgent problems with the cash. In turn, the borrower ends up renewing the fast cash loan, instead of just extending it for a period of days.