There are many people who live paycheck-to-paycheck and do not have easy access to the traditional sources of credit. If you are in need of some short term money, you may want to consider taking out a cash advance loan. There are many direct cash advance lenders in store fronts all across the country. For an even more convenient way to get a cash advance loan, you can visit one of the numerous online direct cash advance lenders. Before you apply for or agree to one of these short term loans, there are some important things to understand.

WHAT IS A CASH ADVANCE OR PAYDAY LOAN?
It is a short-term loan, generally for 2 weeks.

HOW MUCH CAN YOU BORROW?
The amount varies from depending on the particular State where the loan originates. Generally, loan amounts are $500-$2,000.

HOW DO YOU QUALIFY?
You need to be at least 18 years of age and have a job or regular source of income and a checking account. Some companies may require additional qualifications such as a minimum monthly income or proof of residency.

WHAT IS THE PROCESS?
The borrower is approved for a loan and signs a contract agreeing to the loan’s terms of repayment. The lender may ask for a post-dated check or access to your checking account. They will either issue you a check/cash (in a physical location) or electronically deposit the money into your checking account. When it is time to repay the loan, the lender will either deposit the physical check or electronically withdraw the amount of the loan plus their fee for providing the loan.

WHAT HAPPENS IF YOU CAN NOT PAY BACK THE LOAN?
The lender may charge you additional fees for extending the repayment period. If you completely default on the loan, you can be pursued civilly and possibly wind up in a court of law.

HOW MUCH DO CASH ADVANCE LENDERS CHARGE?
The amount varies from lender to lender. Lenders require you to repay the principal borrowed plus a fee for their service. Fees also vary based on the size of the loan, State laws and the policies of the Company.

ARE THOSE INTEREST RATES REALLY 100%?
No! They are usually much more. Because loans are for such a short period of time and lenders technically charge a loan origination fee and not an interest rate, the effective Annual Percentage Rate (APR) can work out to 500% or even much more.

If you Borrow $1,000 for 2 weeks and pay a $240 loan origination fee, that would work out an annual 24% simple interest rate (240/1000).  If you calculate that same fee for just 2 weeks, the 24% interest becomes an astounding APR of 625.7%.