An emergency loan refers to a loan which covers you from damages caused from any unforeseen circumstance. Any kind of emergency can strike you at any point of time for example emergency loan for educational purpose, for meeting with any natural disaster if a person does not have cash to cover him from the damage in such a case an emergency loan can be very useful.
Emergency loans offer the following advantages:
.Fastest Source of money :
Pay Day Loans are quick to apply, receive and pay. Most probably we get the money within few minutes, if we need money for any work or emergency, this is a most popular and also gaining its share in India.
Pay Day Loans absolutely saves you from Bank overdrafts, credit card usage, Bounced checks that results in very high charges and fees.
.Credit Report :
credit report is not been required in Pay day Loans, if your report is negative then also this loan is available for you, only we have to come up with a valid id proof and few post dated cheques as been required.
Although it is convenient to be able to get the money you need when you need it, the interest rate that you can expect to pay is very high. Since these loans are usually as short as two weeks, no one stops to consider how much interest they are charged. By the time it is all done, you are actually paying over 200% APR. Consider how much you are paying for the money before you go through with the process.
Add to the problem :
With an emergency cash loan, you may actually be compounding the problem. With the high interest and potential fees, it usually adds up to a lot of money. When you already do not have enough money to get by until payday, an emergency loan can make things worse in the long term.
Easy money :
When you have access to emergency loans, you may end up using them incorrectly. Instead of using them just for emergencies, you may be tempted to buy things that you don’t need and cover the bill with an emergency cash loan.