Small amount of loans taken up for a very short period of time to manage unexpected financial crisis is termed as cash advance loan. It helps a person to recover from sudden emergencies. People with little savings generally apply for these loans. The general feature of this type of loan is quite similar with all the other loans except for the rate of interest and some specific terms and conditions. The general features include very short repayment tenure. Full repayment of the loan along with interest should be paid on time. No credit checking is done while the loan is granted. It is an unsecured loan granted in no time. The repayment should be done on the next payday.
Eligibility Required To Obtain Cash Advance Loan
Cash Advance Loan is a very short-term loan, so it does not require a detailed credit balance checking. Even though it is an unsecured loan, the lenders make sure of the fact that the borrower has the ability to repay the advance along with the interest on time. So, the eligibility factor does come into play while securing this type of loan. The age of the borrower should be 18 years or above. The person should be working with a stable and fixed monthly income, should have a valid income proof, social security number, and of course a bank account.
Process and Steps to get the loan
Online process of obtaining cash advance loan is very simple and it does not need a fax machine. Only an Internet connection will serve the purpose. After deciding with the lending company the borrower needs to go to the website of the chosen lending company and fill up an online loan application form. This application form includes some mandatory fields, which will be needed for a primary verification about the borrower. After filling up the application form the borrower needs to submit it online. As soon as the form is submitted, the checking process starts with the automated server. It does not take very long to be checked by the server. A couple of hours will finish the whole processing. When the checking process completes the borrower immediately gets intimated that the cash advance loan is through. If the borrower agrees to the terms of the loan, he will automatically have the loan amount transferred in his bank account.
Pros and Cons
Acquiring a cash advance loan is easy and simple, but the repayment terms are very strict in these cases. First, the full amount of the loan along with the heavy rate of interest should be paid dot on time. If a person fails to do so, he might get into some real trouble. Since the rate of interest in cash advance loan is quite high, the total amount of repayment becomes really big. And for some, the repayment on time becomes impossible, which amounts to a further increase of the interest rate. Some borrowers pay the principal amount and keep the interest for future repayment. This leads to a situation where the payable interest mounts up to become larger than the principal amount. Thus the borrower may get himself stuck in a never-ending loop of debt. A thorough knowledge about one's own capability and a good market research can strike out this problem while opting for a cash advance loan.