How similar are bank ‘Early Access’, ‘Ready Advance’ or ‘Deposit-Advance Loans” to what most people know as direct low cost payday loans? Depends on who you ask. As direct lenders are often tied to negative predatory reports, banks tend to miss that targeted reputation. If anything, people would be more apt to trust their bank for a short-term loan over a payday loan company just by reputation alone.
When a person does their homework to find a responsible direct lender with low cost payday advance loans they may have to comb through quite a few company names to find one. For those people who already have a lender in mind, have used one before or had heard good things about a certain company, their search is quite easy. Others may go directly to their bank in hopes of getting the best loan practices. Depending on how you look at best practices, you may end up using your bank or find yourself a trusted direct payday lender with low fees.
With only a quick look at terms and conditions, an applicant may see the bank as the lender with the lowest interest rates. Since interest is such a controversial issue with short-term loans, a low fee direct payday loan may not be as low as what the banks can offer. Many bank interest rates are half of what other direct lenders can afford to offer payday loan help for.
In order to qualify for a bank loan you must have a good standing bank account with them. Direct deposits are another prerequisite very similar to typical lenders. What is the difference? Once approved, the money will not take a business day to process as there is no exchange of hands in the process. Many of these banks offer a flat loan amount of $500. This is good news for borrowers who were offered much less from a direct lender. With instant access to direct deposits, banks are going to collect their money.
Typical payday direct lenders will set up a debit payment on or around a payday. Banks will automatically withdraw their funds as soon as any deposit hits the account. There borrower has no time to see the money sitting in the bank. If the money is not there or if direct deposits are canceled in order to prevent the automatic payment, the troubles begin.
When a borrower uses a responsible direct lender, not having enough money in the account will turn into an NSF fee attached to the remaining balance of the loan. Additional interest to rollover the loan will be added if the lender cannot contact the individual for payment. Some lenders will have a credit card on file to use as a secondary form of payment. If it is your due date and your lender is calling, it will be to your advantage to answer. Avoiding their call offers no payday loan help.
Banks run things a bit differently. Once a deposit comes in, the money is taken right away. If that cash is not enough to cover the loan payoff, then there are overdraft fees plus additional interest placed on the account. Switch out your direct deposit so your bank doesn’t take their money? You could possibly see your bank accounts frozen the next time you try to use it. Besides additional fees, this brings on a whole lot of hassles you may not want to ever experience.
Whether you are trying to obtain a low-cost online loan, one through your bank or extend your credit limit, debt is something you want to be prepared to manage within your budget. Pay attention to the terms and conditions for the money option you choose and make sure you stay in communication with them – especially if you encounter further money problems.