How online loans work- The process and the duration
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How online loans work
Online payday loans are short-term loans designed for people who need a quick injection of money before their next paycheck. The idea of a payday loan online is to borrow fast and easy and is an amount of money to take care of life’s little emergencies. The usual amount of instant cash loans is between $50 and $500. You can get one of these loans from a payday loan online lender, a company that also has a range of other financial services such as foreign currency exchange, utility bills paying and license processing.
How does it work?
The process to apply for a loan online is rather simple. The common process looks like this:
- Visit a loans online lender’s web page. These companies often have physical stores too, but you can almost always apply online or on the phone. However, some lenders only have their businesses online.
- Normally, applying for an instant cash loan will require you to fill out basic personal information such as your contact details, employment and banking information. The lender may ask you for the contact numbers of a few close friends or family members and may call these references if you don’t pay back your loan.
- Write a post-dated check in the name of the lending institution for the amount of money (plus any fees the lender may charge) you want to borrow or pledge to pay the borrowed amount by a certain date. Usually, lenders express their fees in $100s and paying $15 per $100 of a loan is rather common.
- The lender gives you a check for the loan amount or deposits the money in your bank account.
- The lender holds on to the check you’ve written throughout the loan term which is usually two weeks.
- When the term is up, the lending institution cashes the check or debits the loan amount (plus any fees) from your bank account.
- Rollover: If you are not able to afford to repay in full, you can roll over the remaining amount of the cash loan to another term (usually for another 14 days). The lending company will tack on another fee.
How long does it take?
The cash loan online application process is fast. It usually takes less than half an hour. After that, you’ll usually get the loan amount deposited into your bank account within one working day.
Convenient application and easy approval are what makes quick loans online attractive. One of the biggest advantages that payday online lenders have over banks is their flexibility. Online payday loan lenders have more locations and operate for longer hours than most banks. Some companies are open 24 hours daily. How often do you see a bank open on Sunday?