An online cash advance loan differs from a traditional personal loan in that the application and approval process is very quick – sometimes as little as 24 hours – and the documentation required is much less than a traditional bank loan.
Online cash advance loans are generally granted to applicants who can prove steady employment or income. Sometimes referred to as payday loans, these cash advances are just that, an advance on the money the applicant expects to receive on their next payday.
Documentation required to apply for an online cash advance loan will include information on your employer, your gross pay and your payment schedule. If you are a first time applicant, you may be required to fax a copy of a check stub and/or your last bank statement. There are online cash advance loan companies that do not require any faxing and the entire application process is completed online. If approved, the money is deposited directly into your bank account the next business day.
The benefits of a cash advance loan are obvious. The money is deposited in your account and available within 24 hours of applying for the loan. Your credit history is not used to determine eligibility, so these loans may be the best resource for those with bad credit. The documentation required is simple to obtain and provide, making the process fast and convenient.
The fees on cash advance loans are usually a percentage of the amount of the loan. This fee is charged on top of the loan amount and if the loan is renewed or rolled over, the fee will be charged each time you renew the loan. Sometimes loans are extended automatically and the company will deduct only the fees and interest from your account. You may make several interest payments before you begin to pay off the principal if your loan automatically renews.
An online cash advance loan can be the solution to a pressing financial crisis – when a car or rent payment is overdue, checks may bounce, for emergency medical or dental care, when you face shut-off on vital utilities or in other cases of personal hardship. In these cases, the damage to your credit or the personal hardship could be more costly than the interest or fees on the loan. However, taking an online cash loan should be a last resort solution, and it is advisable to pay off the loan on the first payday to avoid accruing additional fees and interest.