When a person wants to apply for a loan from a bank, he has to fill in an application and submit the required documents to the bank, depending on the kind of loan he’s applying for. After studying the documents correctly, the bank will decide whether the applicant can be given the loan. But there are certain kinds of loans which do not require any documents for instance payday loans.
What is a No Fax Payday Loan?
A payday loan is a loan which a borrower has to return after 14 days or the next payday. Since such a loan generally does not require any documents to be faxed, it is called a ‘no fax payday loan’. This however, is a recent development and this was not the case always. There used to be a time when the borrower had to go to the lender’s shop to borrow a payday loan. He had to submit the required documents and would be granted a loan. Then came a time when a person who wanted to borrow a payday loan could call the lender and ask him for a loan and he would fax the required documents such as the salary statement.
Today however, the procedure of obtaining a payday loan is very simple. All you have to do is switch on your PC, log on to the Internet, search for sites which provide access to payday lenders. Select a site and enter your details in the prescribed form. This will hardly take a minute and in a matter of seconds you will know whether the loan has been approved or not. Nobody asks you for any document. You would have entered your salary amount, employer’s name and date of joining work in the form. So a fax is not required and that is why a payday loan today is a no fax payday loan.
Features of a No Fax Payday Loan
- The borrower of a no fax payday loan needs to be above 18 years of age and a citizen of the country.
- He should have a checking account and preferably a debit card.
- The lender will not check the credit history of the borrower.
- No documents need to be faxed by the borrower.
- There is the option of paying back the loan in installments over successive paydays, but the lender will charge higher fees.
- If you have borrowed a no fax payday loan, the lender will not grant another payday loan till you repay the earlier one.
- Loan amounts usually range from $100 to $1000 depending on the salary amount of the borrower.
- The fee that includes interest and processing charges is quite high compared to that charged by banks.
- Though the loan money is deposited within 2 to 5 days after approval, a same day deposit is possible at an additional fee.
Precautions to be Taken When Borrowing a No Fax Payday Loan
- Before borrowing a payday loan, make sure that you can afford the high fee which the lender would charge. For borrowing $100 you may have to pay fees of $30. The APR or the annual percentage rate of interest works out to be very high.
- A no fax payday loan is usually taken by people with low incomes. It should not be taken on a regular basis as such loans may worsen one’s financial condition and the borrower may soon find himself deep in debts.