If you’re a part of the nearly 80% of Americans living paycheck-to-paycheck, you know just how difficult affording unexpected expenses or making larger purchases can be.
You know that you’ll have the money to pay for these things soon, but not before your next paycheck arrives. If you want to get access to that money before your boss deposits it into your account, you might consider applying for an online payday loan.
But who you use to borrow from is just as important as the amount of money you can get.
Read on to learn what you should look for in online payday loans direct lenders.
1. Understand If You Qualify
Before you start doing serious research into your options for online payday loans direct lenders, you first need to make sure you meet the qualifications.
While each lender will have specific qualifications, in general, there are a few you’ll need to follow. You need to be at least 18 years old, be able to provide proof of identification and of residence in the state in which you’re applying for the loan, and you must have a working checking account.
Most lenders will also require you to show some sort of proof of income.
This can be a pay stub, a letter from your employer, your past bank statements, or a letter from your financial manager if you’re living off your investments.
However, the number-one thing that people worry about when looking for the best online payday loans is whether or not the lender will be willing to work with their credit score.
Since over 43 million Americans have poor credit, the good news is that you have lots of options for lenders that either don’t check your credit or that will work with you if you have a poor score.
2. Know the Lender’s Specific Terms
When you’re looking for the best online payday loans, it can be all too easy to fall into the trap of shopping only by the maximum amount you’re allowed to borrow.
But not only is borrowing more than you need the easiest way to enter into a cycle of debt. It may also be a predatory lending tactic.
Make sure you know exactly how much you’re allowed to borrow. If the maximum amount seems too good to be true, go with your gut and walk away. Don’t fall for it.
Additionally, make sure you know how long you have to pay back the loan and the interest rate you’ll be charged. Look into any fees/commissions/penalty payments associated with the loan, as well.
3. Study the Payment Structure
In addition to all the things we mentioned directly above, you also need to study up on how much you’ll need to pay your lender every month.
But just as important as the dollar amount is how the lender collects that money. Paying your loan back shouldn’t be a hassle. Plus, if the process is overly complicated, it could be a tactic to get you to consistently pay late fees.
Your best option is usually to work with a lender that takes and deposits your money and payments directly out of your banking account. It’s one less thing you have to remember every month.
4. Research the Lender’s History
You read online reviews before buying products or booking services. So, why wouldn’t you do the same for your lender?
With all of the loan scams out there, never assume that just because a company looks legitimate that it actually is.
Instead, check out this guide on how to verify a lender’s credentials.
Always ensure they’re registered with the Better Business Bureau and see if they have any past or pending litigation against them.
You should even speak with references to get a better understanding of the kind of experience and service they’ll likely provide.
5. Compare Quotes
When you’re applying for online payday loans direct lenders have to offer, you should always compare different quotes.
We suggest connecting with a minimum of three lenders before making your final decision.
This will ensure that you get the lowest possible interest rate, fair fees, and a lending package you’ll be happy with.
Of course, the real reason to contact multiple lenders is so that you can use a lower offer from one lender as a bargaining chip with the lender you really want to work with.
6. Understand Communication Styles
Whether you’re looking for a cash advance online same day loan or if you need something a bit more long-term, there’s one major thing you still need to consider.
That’s your lender’s overall communication style.
Do you feel like they can clearly explain the terms of the loan to you? Have they done a good job of walking you through the application process and telling you which documents you need?
Have they provided you with a unique lending package that fits your specific needs, or are they just giving you the same options as everyone else?
When it’s your financial future on the line, superior customer service from direct payday lenders matters more than ever.
You’re Ready to Find the Top Online Payday Loans Direct Lenders
If you follow the tips in this post, we’re confident that you’ll end up working with quality online payday loans direct lenders that are reputable, easy to communicate with, and will create a fair repayment plan for you.
Of course, payday loans are far from your only borrowing option when you’re in a financial bind.
You may be interested in business loans, mortgages, asset-based loans, student loans, lines of credit, and other personal loans.
Need to learn more about the differences between these loans, and which one is right for you?
Our blog is here to help you with that, so keep checking back in with our posts for top financial advice.