Best Cash Advance Online Loans 2020

When you have a financial emergency, cash advance online loans may be the fastest solution. But before you take one, you should think it through because it can leave you mired in debt.

So what are they? They are short-term loans targeting people who need immediate cash. They also have other names like payday loans, no-credit-check loans and guaranteed loans. In the 21^st century, there’s no shortage of these loans online and even in storefront locations.

They usually have high fees, and as such, you risk getting stuck in a debt cycle if you do not know what you were getting yourself into from the get-go.

In this piece, we shall make one assumption – that you have weighed your options and cannot get a loan fast anywhere else and that your need is pressing, and you need the money the same day. In the guide, we shall dive into everything you need to know about cash advance online loans, from how they operate to their costs, pros and cons and FAQs.

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How do Cash Advance Online Loans Work?

In the 21^st century, the internet is everything. Most businesses have moved online to sell their services and products. Lenders have also decided to leverage the internet and its technology to reach more people and make more money.

Now, since cash advance online loans are short-term loans, they have strict guidelines, hefty rates, and fees if you breach their contract. Luckily, the federal and state government have rules and regulations designed to protect borrowers in their time of need. For instance, all lenders need should adhere to responsible lending (more on this later).

Application

The first step to getting a cash advance loan is to fill out an online application. In this form, you will detail your personal information as well as your financial status. The lenders will use this information to determine if they will approve, reject, or make changes to the application. Because of this, you should ensure you provide the correct details.

But what if the details are wrong? How will they know? Like many short term loans operating in the US, cash advance loans are offered to borrowers with bad credit history. This means that lenders do not consult with financial bureaus in the US. Because of this, lenders open themselves up to a lot of risks.

To protect themselves, they take the initiative of confirming your employment status. Typically, lenders will call you a few minutes after submission to confirm the details. But other times, they decide to call the employer you’ve listed on the application. The purpose of the call is to confirm you are an employee and hold the position you claim to. But don’t worry they do not disclose your intent to take a loan.

If they are content with what they see and hear, they will approve the loan. If they are not, they will reject it. They only make changes to the loan amount if they feel it is too high, and you will have a hard time repaying and meeting your basic needs after. Lenders are allowed, no, expected to do this under responsible lending.

After Loan Approval

Before you get to this stage, you already know how much the loan amount will cost you. Most lenders have a loan calculator on their platform, which makes it easier for borrowers to decide on affordability.

Once the loan is approved, the lender will send a loan agreement. This document contains the loan amount, the rate, and the due date of the loan. You should read through the document to ensure you are comfortable with the terms before you commit to it.

If you are okay with the details, the lender will deposit the loan amount into your bank account within the day (assuming you applied well before the close of business).

How long does the process take?

Cash advance online loans are not called fast for no reason. After submitting your application, it is reviewed and approved within 15 minutes. And depending on the payment method, you will have the money a couple of hours after.

Repayment

Cash advance online loan amounts vary between $500 and $5000. The amount you borrow and the lender you choose determines how long you have to repay the loan. Most lenders expect you to make payments within a month – on your next payday.

So how do you make the payment? For online applications, most lenders will debit your bank account for the payment. This is why they all ask for your bank and insist that it is active. If you apply at a store location, you will write the lender a post-dated check. The post-dated check contains your bank account details and the routing number.

You can also opt to make manual repayments. With manual payments, you have to be on toes with the payment dates and repayment amounts. It also helps that most lenders will call you two days to the due date to remind you of your payment.

During this call, if you feel you might not make the payment on time, you should voice your concerns. The lender might offer an extension for the loan, but only after you have paid the interest and other fees for that month. Though it gives you more breathing space, the longer you have the loan the more expensive it is.

Types of Cash Advance Loans

There are different types of cash advance online loans. But the one thing they have in common is the high-interest rates and fees.

Credit card cash advance

This is the most popular type. Borrowers get a line of credit through their credit cards. You can get the money from an ATM, through a check or cash from your bank. Like other emergency loans, credit card cash advances don’t have grace periods.

Merchant cash advances

These same day loans are for businesses that have a poor credit history. They use the cash advance to finance business activities. These loans are usually paid with future credit receipts or with funds the business receives from its sales. Enders offering these emergency loans don’t consider the credit score of your business but instead consider several data points including the money that you receive through online accounts like Skrill and Paypal.

Payday loan

This is a cash advance loan offered to individual borrowers. The loan amount is usually between $50 and $1000 and has fees of about $15 for every 4100 borrowed. Still, payday loan lenders don’t consider credit score but rather focus on the size of the borrower’s paycheck and the state regulations on loan amounts.

How much do Cash advance online loans cost?

To make an informed decision of whether a cash advance online loan is a product for you, you should know how to calculate the cost of the loan. Say you borrow a loan of $500; you might incur a fee of $75. This means that by the end of the loan period, you will repay $575. In this case, $75 is the cost of the loan. Lenders calculate this amount (APR) from interests and other loan fees that apply.

Now you are probably wondering what in the world an APR is. In simple terms, it is the cost of borrowing money. Many borrowers tend to think that the annual percentages and the interest rates are similar. While this might be true for the credit card companies, it’s not for bad credit lenders.

The interest rate is the percentage of the principal amount the lender charges when you borrow money while APR is the interest and all other loan fees. Therefore, the APR gives a better idea of how much a loan will cost as a percentage.

How cash advance online loan lenders calculate APR

The calculations aren’t difficult because there is a constant formula used.

Here is a practical example to explain how the formula works.

Say you take a $1000 loan repayable over 180 days. In the end, you will repay $75 in interest. And if the loan has an origination fee of $25, you should so include that in the formula. When you plug these figures into the formula, you get an APR of 20.28%.

But why is the APR important?

Easy, because it gives you a good idea of what you will pay for the loan. If the APR is too high, you should stay away from the loan because it will only strain your finances further.

Types of APR

There are two types of APR;

• Variable APR – this type changes and is tied to the index interest rate as the prime rate. This means that if the prime rate increases, the variable APR increases as well. Some people love variable APR because it provides low-interest rates. However, these rates change with time and could eventually be against you.
• Fixed APR – this is an APR that doesn’t change depending on the index when repaying the loan. As such, they are predictable and make budgeting easier.

Do I qualify for a cash advance online loan?

With the tough financial times, the demand for emergency loans has increased over time. Lenders get hundreds if not thousands of new applications every month. And unfortunately, not all borrowers qualify for the loan or are serious. So to reduce the workload and ensure that every borrower is serious, lenders have screening criteria. These qualifications include;

• You should be between 18 and 21 years old (depending on your state of residence)
• You should be a US citizen
• You should have an active current or savings account
• You should live in a state that the lender serves
• You should have a stable income (enough to repay the loan amount and still have enough for basic needs)

Why you should consider cash advance online loans

Fast processing

If you have a financial emergency that needs immediate attention, cash advance loans are good solutions. You only wait for a business day for the money to hit your account.

Offer bad credit borrowers

Whether you have low or no credit history, lenders will give you a loan. This is a huge plus because traditional banks only extend loans to borrowers with a good credit score.

Loans approved after meeting the minimum requirements

Once you meet the minimum requirements we outlined above, you can consider your loan approved. The minimum requirements are a good thing for borrowers who don’t want to deal with the paperwork and want to save time.

You can get the loan at the comfort of your home

Many lenders have an online presence. The application forms are available online. Once you submit the application form and the loan is approved, the lender wires money to your bank account.

Why you should be cautious of cash advance online loans

Cash advance online loan lenders advertise their products as being easy and fast to get. The fact that they give loans to borrowers with poor credit scores piques the interest of many. But if you are the kind of borrower that always has shortfalls of cash and cannot keep up with your bills, the expensive cash advance online loan might be the end of you. It is because of this that Washington DC and 14 states don’t accept payday loans.

Below are other reasons you should think twice before getting cash advance loans

They have finance charges

These loans have borrowing fees, which increase the APR to between 300% and 500% (for some even higher). This might not occur to you when you are taking the loan because most lenders display the flat dollar amount. But upon closer inspection, it will dawn on you. If you borrow $500 and repay an interest of $75 plus a finance fee after two weeks, the APR would be 391%. When you compare this figure with what the federal APR average of a standard personal loan lasting two years, at 10.36%, you understand why we are saying its expensive right?

There is no credit check and possibly no credit building

Most banks will check your credit score and if you can afford the loan before they approve it. However, payday loan lenders don’t conduct a hard credit check. This is great for those with poor credit scores, but it often means that the lender will not help you improve your credit score either because they will not report your faithfulness to the main credit bureaus.

You might get a bank overdraft

Most emergency loan borrowers have complained that lenders have overdrawn their accounts and caused them to incur extra fees with the bank. Very few lenders will consider the amount in the bank before processing a repayment.

Verdict

Cash advance online loans are saviors. But they could be your downfall if you don’t consider the cost and your ability to repay the loan. Before submitting your application, bear in mind that there is no grace period and that it is a short term loan (meaning it lasts for a maximum of 90 days).

Also, the fact that cash advance online loans have high APRs doesn’t mean you cannot find and affordable lender. Do your due diligence and find an affordable lender – loan brokers can reduce the time you take.

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Our Rating

• Loans From $100 to $15,000
• Instant Application & Approval
• Bad Credit Considered
• Lenders From All 50 US States Onboard

Apply Now

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