Savings Account Payday Loans
Savings account payday loans are an option available through the cash advance industry, which allow income-dependent advances for those needing a financial float between paychecks. Savings account payday loans may be a better choice than the more traditional online payday loans because savings account payday loans are based on the borrower's bi-weekly net pay, making the likelihood greater of the loan being repaid with the least amount of finance charges.
While savings account payday loans can fill the gap like other online payday loans, they are often limited to $500 or less, depending on the borrower's bi-weekly net pay. Lending companies do offer savings account payday loans for more than the borrower can repay in their following paycheck. Some companies offer first-time deals for savings account payday loans that disregarded the interest payment if the loan is paid in full by the due date. However, interest rates are high, as with other cash-advance options, ranging from $30-$90 per loan or $15-$30 per $100 borrowed. Again, the companies vary widely regarding their pay back policies and rates, so reading the fine print is mandatory.
Similar to other online cash advance options, savings account payday loans can be applied for by completing an application online. However, unlike other cash advance options, potential borrowers are not obligated to borrow even after they complete the application and are approved. Potential customers are notified of the fees and interest rates before they agree to the loan.
Another potential advantage for borrowers is that most companies do not require a credit check to qualify for savings account payday loans. However, they do require that the borrower be employed and have a direct deposit savings account. Some companies offer a no-faxing option for their application process, but this is dependent and determined by the completed online application. Typically, the bank routing number, savings account number and borrower's social security number are needed when applying for savings account payday loans. If the borrower is approved, the loan is usually transferred electronically to the borrower's savings account within 24 hours.
Savings account payday loans appear to be a more realistic solution to financial emergencies than the usual online cash advance loan. Because savings account payday loans do not exceed the borrower's biweekly net pay, it is more likely that the borrower will be able to repay the loan in a timely manner. However, the interest rates are still far greater than other financial options such as credit union or bank loans, or loans from relatives. Therefore, savings account payday loans should still be carefully and thoughtfully considered, especially if other options are available.