What are Payday Loans and What do You Need to Know about Them?
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Payday loans play a balancing role in the short-term lending sector in Singapore, providing temporary liquidity to those who need it. For the uninitiated, payday loans are usually a short-term loans with a higher rate of interest as compared to other loans and the dues should be paid on your next payday. Depending on the regulations of countries, you can get the payday loans online or even from storefront payday lenders.
Though payday loans are one of the most popular loans now, it also comes with a few risks. One should always weigh the pros and cons well before taking a payday loan in Singapore. Here’s a look at some of the fundamental features of payday loans to help decide if it’s suitable for you:
1. Loan size
Payday loans are only for small amounts and you cannot use it for paying huge debts. Mostly, the payday loans are used to make payments of the credit card bills and other outstanding liabilities that are of a small amount. A common loan amount for this is around $500 but can, of course, can be higher or lower depending on your need.
2. Single repayment
Unlike other loans, you don’t have the privilege of repaying in installments and the amount has to be made in one go on the next payday or with income received as a premium of social security or a pension. The due date for payment is usually 2 to 4 weeks from the issue date of loan and it is usually decided on the day of the loan itself.
3. Mode of repayment
To repay the loan, you will need to give a post-dated cheque for full balance which includes the fees as well. One can also authorize the lender to electronically debit the funds from your account on the due date.
4. Risks involved
Payday loans come with certain risks such as unable to pay the loan on the next payday, being charged with a higher rate of interest, the risk of getting in deeper debt, reduced credit scores, higher fees and an additional loan to the current loans. Thus, one should make the decision only after considering all the above-mentioned risk factors.
Explore the web for more tips on finding a reliable lender who can offer a fast cash loan with minimum risk. It is recommended that you read all the terms and conditions mentioned in the loan documents to ensure that you never get trapped in any fraudulent activities or scams. Keep browsing the web and read about loan-taking tips that can help you to stay protected from fraudulent moneylenders.