The cash advance short-term loan is often misunderstood. The cash advance short-term loan often has a negative stigma. This is due to misunderstanding about the cash advance loan. A cash advance loan should never be compared to a long-term loan when it comes to interest rates. The interest rates work in the same way--to pay the lenders.
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But, the reason why interest rates and loan fees are higher on cash advance loans in comparison to long-term loans is that the lender for cash advances needs to make a living off of the services provided. And if the interest rates and fees for cash advance loans were the same as long-term loans, then the cash advance and payday loans lenders would never make enough to render the services of short-term loans. Because, when applied to the very small amount of cash that cash advance and payday loans are, the interest rate is the amount that it is so that the lenders can make money just like any other business.
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The cash advance loan is never meant to be paid on a long-term basis. If the cash advance loan was paid off on a long-term basis, then yes, the interest rates and fees would be an absolute scam to get your money, but they're not. A cash advance loan, when complied with and paid off as agreed--within thirty days, or your next payday--the cash advance loan fees and interest rate come to much less than let's say a $35 over-draft fee from the bank.
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The short-term nature of a cash advance loan and a long-term loan also sheds light on the reason why a cash advance or payday loans lender doesn't have to check a customer's credit to approve the cash advance loan application. There is never a long-term payment agreement between a cash advance lender and cash advance customer. "Credit" applies to a long-term loan situation where a loan lender agrees to loan a huge amount of cash and the customer agrees to pay a little back every month for thirty years or less. Your credit is a score showing how well you do on those payments every month. Your credit is basically your track record in paying back those long-term loans and agreements.
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A cash advance never needs to be approved upon credit scores and your long-term payment track record because a cash advance and/or payday loans are meant to be paid back within thirty days or by your next payday, whichever comes first. So, the only information that a cash advance, fast cash, or quick cash lender needs to ensure that you are capable of paying back the cash advance loan and fees is that you have income and/or employment. That's all the lender needs to know that you are capable of paying your cash advance and payday loans within your next payday period. That's all a lender needs to approve your cash advance application. Of course there's the other logical information a cash advance lender would need--your name and address and bank account to issue the loan and wire your fast cash--but the employment verification is really what the lender looks for in your ability to pay the amount of the loan.
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The short-term nature of a cash advance loan and a long-term loan also sheds light on the reason why a cash advance or payday loans lender doesn't have to check a customer's.... Learn more at Cash Advance Texas and cash advance payday
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