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Choosing an Unsecured Payday Loan

Written By emilie dane on Friday, March 15, 2013 | 9:48 AM

Should you find that you need just a little bit more money to make it to your next paycheque, then you might want to consider getting an unsecured payday loan to help you make ends meet. When you take out an unsecured payday loan, your loan will be processed quickly and without a credit check so that you can get the money that you need now instead of weeks from now.

As an additional bonus for choosing to borrow with an unsecured payday loan, the money that you borrow won't be charged interest but instead will simply have a small service charge added on to the borrowed amount so that you'll know exactly how much you need to repay even before you have the loan money in hand. Consider the following information to help you decide whether or not an unsecured payday loan is right for you.

Fast Approval

When you need money now, it doesn't help if the loan you apply for takes a week or more to process. That's one of the things that makes an unsecured payday loan different; these small loans are processed in-house right in front of you, and the money that you need can be in your hands when you walk out of the lender's office. All that's required in most cases to get you approved for your loan is a valid photo id to prove your identity, some proof of residence, and recent bank statements and cheque stubs to show that you have an active chequeing account and a steady flow of income.

Interest-Free Lending

As mentioned above, unsecured payday loans don't use interest as a means of making a profit for the loan provider. Since the loans taken out in this way are low in value and have short repayment terms, charging interest would be fairly futile; instead these lenders charge a small service fee to cover their expenses. This fee can take the form of a flat-rate charge or a percentage of the total amount borrowed, but regardless of which method a particular lender chooses you will still be able to easily manage your loan repayment and quickly determine exactly how much you owe.

Short Loan Terms

Since this type of loan is known as an unsecured payday loan, it makes sense that the money you borrow is only intended to last you until you receive your next paycheque. This way you don't have to schedule regular payments on a large loan, but can instead borrow only as much as you need for your expenses and repay the loan once you've been paid again. Average loan terms last for one or two weeks, though different lenders may offer longer repayment times as well.

Ease of Repayment

When you take out an unsecured payday loan, you will leave a cheque on file with the loan provider for the amount of the loan plus applicable service charges. Once you've got the money to repay the loan, you have the option of picking up your cheque and paying off what you owe or simply letting the lender cash the cheque once your loan comes due. This can save you both time and effort, and makes repayment a breeze.

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