Archive for January, 2012

What Are Payday Loans Online?

No doubt most people will have heard of payday loans online at some point however what they actually are is not as well known and there exists some myths and misconceptions about these types of money transactions. Essentially this type of loan is a short term solution to a financial problem. Say, for example, you need to pay your electric bill by a certain date or you will be cut off; however, you are not paid until a few days after the date in question. This means that there will be a few days (or even a week or two in some cases) between when a certain bill has to be paid and when you will have the money to pay for it.

A payday loan is an unsecured loan that is designed to combat this very problem. It offers a short term solution to a financial crisis and there is no restriction in terms of what the loan can be used for so it can be used to pay for an electric bill, gas bill or even a mobile phone contract bill as well. What does unsecured mean, though? Basically it means that the lender is relying on your promise to pay it back by the agreed date rather than secure it against an item that you possess that would be of the same value of the loan; usually a car or something like that.

This means that the interest and repayments are often higher however this is only to protect the lender as there is no collateral to secure the loan against. Millions of people need some form of fast cash solution at some point in the year to tide them over until their next pay check and with payday loans online you can get the money you need in no time at all.