How a pay day loan works?

Most online payday loans require the consumer to type out a online application form providing personal information, employment information, current banking and financial information, and references

The typical requirements need to be meet and usually consist of the following:

• Being employed for at least 3 consecutive months.
• Earning at least $1,000 per month in income.
• Having a valid checking account open for at least 3 months.

An advantage of online cash advance payday loans to most consumers is that they are offered to people with no credit, poor credit or bankruptcies AND they can be done anonymously to the public and in the comfort of one’s home hance making them simple and hassle free.

Unlike normal lenders or banks is that online payday loans lenders do not require credit bureau reports from Experian, TRW, or Equifax. Instead, most online payday loans lenders use consumer information services provided by Tele-Track. These services do not check your credit history hence poor credit ratings are not shown. Tele-Track simply verifies the applicant’s personal, employment, banking and lending information.

Once the application form is completed, the details are sent to the online cash advance loans lender for review and approval. If the applicant is approved, he or she will be notified (typically via email) that they are approved. The payday lender calculates the amount of the payday loan to be lent, usually between $100 and $1500. The amount of the approved payday loan is dependent on several criteria.

The approved applicant is required to print and sign a copy of the online payday loans lender’s contract with the loan amount, fees and terms specified. Lenders may have other requirements and mandate that paycheck stubs, bank statements, and a personal check also be faxed to the lender.

Once the fax is received by the lender, the lender will verify the information is correct and process the loan. Most online payday loans lenders will electronically deposit the loan amount in the applicant’s checking account overnight.

On the last day of the terms the lender will electronically withdraw the loan plus any fees that were confirmed earlier. For example, if the payday loan was for $200, and the loan fees were $20 for each $100 borrowed, then the amount electronically withdrawn would be $240 at the next term. Some lenders have roll over terms which can be extended to the next payday too.