PAYDAY LOANS VS BANK LOANS

Payday loans also referred to as cheque advance loans, refer to a borrowing scheme , usually on

a short term basis, where a borrower is required to refund the loan with some interest after a

specified period of time. The borrower is required to write the amount of money he or she wishes

to borrow plus the interest accrued in a post-dated cheque in exchange for liquid or tangible cash.

The lender will then cash the cheque on the specified date.

Advantages and disadvantages Despite them being very unpopular, cash advance loans have proved valuable in times when a

person is facing severe financial woes and needs money immediately to resolve an emergency.

These loans are better during times of crisis where getting a bank loan may not be the best

option. These loans come in handy if you want to

shop for a home online. Bank loans are hard to get,

they involve a lot of paper work and take time to

process. In terms of urgency, cheque advance loans

are more convenient as they do not involve a lot of

paper work and time for the loan to be processed.

The most important aspect of these loans is mutual

agreement between the lender and the borrower.

Once the agreement is reached, the borrower is

awarded the loan promptly.

Who needs them? Payday advance loans mostly cater for the low income earners whose meagre income cannot

allow them to save even a small percentage. During emergencies, these people find it hard to

cope with the prevailing situation and so they will sought a way to raise the funds. That is where

cheque advance loans come into play.

The only setback of these loans is that they offer very high interests. This may be a heavy burden

for low income earners to carry, but there are no better loans than others, all have high interests.

This is a cool site for UK loans. Furthermore, cheque advance loans have to be paid within a

short window period, failure to which it may be termed as a breach of contract. Most of these

loans do not exceed the 30 day mark and a borrower can incur additional charges for exceeding

the loan period.

Continuing popularity of these loans…

The main advantage that cash advance loans have over other

loans is the ability to get it when you urgently need it. Despite

other loans having longer payment periods, they have

cumbersome procedures a person has to pass through to obtain

loans. Despite claims that cheque advance loans charge

shylock rates of interest, bank loans tie borrowers to the loans

for a long period of time, charging the same interest. Now,

when you sum up all the interest over the period, you realize that there is no much difference

from the payday loans.