You just cannot predict an emergency, can you? That is the difficulty with emergencies. You can have insurance and you can have fantastic friends and family, but if they cannot help when you require it, you are on your own again. Then what occurs if you require cash all of a sudden?
Not so long ago, a friend of mine went down to the bank after a day's work to draw money from the ATM with his cash card as he had done for years. He put the card in, typed in his PIN and whir, whir, whir: "Please contact the branch that issued your cash card". He knew there was money in the account and he was certain he had put the PIN in correctly, but it was a nuisance. No money and he would have to take an hour off work.
This he did and went to the bank, where he was told that his account was blocked due to a suspected attempt at identity theft. He was told that there would be a short investigation of probably five working days, which meant no money for a week.
What do you do? What are the alternatives? Friends, family? He did not want to admit to them that he had no money, so the only option available to him as he saw it was an emergency payday loan.
His account would become reinstated eventually, there was no question about that and he had all the usual insurance, but none of them could help him here. He had simply fallen through the support net that he had created for himself.
Lots of people do not have such a support net anyway and many people do not have any reserves either. Reserves and insurance are often the first fatalities of a recession, which is one of the reasons for the increasing popularity of payday loans.
However, it is vital to read the terms and conditions and make certain that you will be able to abide by them or you might find that you have made a rod for your own back by accepting a payday loan.
The first conditions are normally that the applicant is of legal age, in stable employment and earning over a thousand a month. Sometimes you are required to have a bank account too (so make sure that you always have at least two in two different banks).
Anyone who meets the criteria will almost certainly be successful. The money is available instantly, but it depends on how much is asked for. The usual range is 100 - 1,500 and the repayment will usually fall due within twenty-eight days. The interest rate, including charges, is horrendous, often at 30% or more, but to be impartial, most of it is a charge, after all it costs equally as much to have an administrator approve a payday loan for 100 as it does for a payday loan of 1,500.
It is crucial to be careful with payday loans because they are so expensive. They should only be used in dire emergencies and never for luxuries.
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