When we talk about loans, what comes automatically to our minds is the voluminous documentary requirement that we need to submit before our loan application is processed. That still applies to most of the credit lines that we used to avail but not with payday loans. There are now the no fax payday loans which are mostly offered online. The internet has offered this innovative approach of loan processing with the automation that it has been continuously introducing. Besides, cash advance loans or payday loans do not necessitate documents to support their approval. They are clean loans and therefore there’s no need to put up collateral. They mature in two weeks and then the security offered is your paycheck comes payday time. But, don’t grab the loan immediately. It has a high interest rate that could devastate your finances seriously. Look for other alternatives before you think of no fax payday loans.
Why No Fax
In applying for payday loans online, the borrower has to accomplish a short online application form that contains your personal and financial information. This data will serve as reference in verifying your capacity to pay through your paycheck when your payday loan matures. Normally, you are given 14 days only which falls coincidentally on your payday. The loan and interest are automatically debited from your paycheck if a post dated check is not required. It is different from the regular loan where several documentary supports are required. The same applies with payday loans served by your local lenders in their traditional brick and mortar offices. Unlike online no fax payday loans where processing of data is faster, efficient and accurate. You just have to fill out the online form on your computer and submit it through a click on your mouse. The activity can be completed in just a couple of minutes. You don’t need to fax any document. The online submission of the application form completes that stage. The loan approval depends on how complete and accurate the information that you have supplied on that form. There are several reasons why a no fax payday loan is allowed by online lenders. Below is a list of those justifications.
- The amount of loan is small-you will note that payday loans are in the amounts of $100 to $1,500 only. While there are other lenders that processed larger principal amounts, normally the amounts involved are what have been mentioned. Because of this petty amount, it makes lenders to omit the submission of any supporting document. The short online loan application form is sufficient for the lenders to verify if the data therein is accurate especially on the net take home pay aspect of the borrower.
- The period to pay is shorter-just imagine the 14 day period wherein a payday loan is due. If this is the situation, will it be feasible to require documents and fax them to the lender? It will take a lot of time to do this and besides the lender does not really need them in the first place. Since the due date is very short, lenders do not give points to the document to support the loan. It is enough that you have significant amount left on your pay slip which is solely the basis in approving your no fax payday loan.
- The interest rate is very high-this is one of the defenses of payday lenders why they are in business-the high interest rates that they are charging. They assert that it would not be feasible to charge regular rates for a small loan with a 14 day period term. No lender will ever venture to lend their cash considering the fact that these loans are without security. The high interest rate is the hope of many lenders to survive considering the high uncollectible rate that they also suffer in doing business.
- The principal loan amount is dependent on the paycheck-when you apply for a no fax payday loan, the loan amount is not what you are receiving on your payday. It is variable and depends on the amount appearing on it. Some lenders put a cap of 40% on this net pay while others use other percentage to their advantage. This is one safety valve to protect lenders from losing in their venture.
- The requirement for postdated check as back-up-while it is risky to put up a postdated check to back-up a no fax payday loan, some States are requiring it. On the date the check matures, the borrower is required to redeem it from the lender. This situation is applicable only through offline transactions. It is seldom required or not at all by online lenders. This is also one reason why some lenders will not require you to submit any document by fax if you can present a postdated check. This kind of check serves as collateral and the lender can go after you by filing a case in court.
- The online processing of information-because your data could be verified instantly with the current technology used on the Internet, any document to support your loan is no longer necessary. So you don’t have to fax a copy of it before your loan is approved. What is important is that you submitted complete and accurate information on your online loan application.
- The payday loan is clean-you will take note that payday loans do not require collateral. They are clean loans and in fact do not require a document to support their approval. You don’t need a security to guarantee the payment of your no fax payday loan. You security is the amount appearing on your paycheck every payday. From this amount, your loan is deducted by debiting your account which you submitted to the lender through the form that you have filed out.
The Requirements Are Simple
Many borrowers are attracted to borrow money from no fax payday loans because the basic requirements are easy to comply. Here is the list of what you must have in order to become an eligible applicant to this credit.
- As to citizenship-it is required that a payday loan applicant must be an American citizen.
- Your age-if you are an applicant for payday loan, the law requires that you should be 18 years and above.
- Your earning capacity-you must be gainfully employed for the past ninety days before you can qualify for a no fax payday loan.
- Your residency status-aside from being an American citizen, the law requires that you must reside in any of the States where you intend to borrow from a no fax payday loan lender.
Faster, Safer and Convenient
Aside from the easy-to-comply requirements, these types of loans are faster to get processed. You can have the cash that you need in less than an hour or at the most is on the same day you applied. This is possible via online no fax payday loan application wherein your data is verified through the internet. We all know that the internet with its myriad of interconnections or data banks is amazing. It is possible to cross check the information supplied in your loan application with a click on the mouse.
While there is a possibility of identity theft when you share your data with an indirect lender on the Web, the confidentiality of your information is safer with BBB accredited direct lenders. Deal only with these online lenders who can assure you of non-sharing of personal and financial data with others as supplied on your application form. Remember the warnings given by the Consumers Federation of America (CFA) of not sharing your data with unknown online lenders.
A no fax payday loan is also convenient to negotiate. You can in fact file your online loan application without stepping out of your house or office. You can use your personal computer with internet connections and directly fill out the online application form. A pointer on your mouse on the submit button will complete its submission. And in less than an hour, the proceeds of the loan is electronically deposited to your bank account.
However, despite the seeming popularity of no fax payday loans among people who need cash immediately, there are also negative comments that you need to be aware of. Foremost among these is the excessive interest rate that they carry. Also, the short payment term of 14 days is a great contributor to forcing the borrower to resort to loan renewal when it falls due. This roll-over of the loan principal when done repeatedly makes the borrower a victim of the loan cycle. At the end of several payments, the borrower would be paying a significant amount for interest charges alone. This is very frustrating. In some instances, the initial loan of $100 becomes eight times including the interest. It’s no longer a lifesaver but a loan shark as many contend.
A no fax payday loan is a temporary solution only. It does not address your financial difficulties permanently but creates another problem that could cripple you financially. Try to avoid this credit facility whenever possible.