Finding reasons for a payday loan.

Reasons To Use A Payday Loan

Payday loans are high risk loans for lenders and sometimes for borrowers. They come with high fees but the fees are often worth it, depending on the situation. So, when are people using a payday loan? Here are some of the most common times that people use payday loans.

When People Use Payday Loans

There are a lot of reasons people use online payday loans, most are good but a few are bad. Here are some of the top times people use a payday loan in the right way.

  1. They were denied a bank loan.
    If someone needs money but can not take out a bank loan, a payday loan or cash advance is often the solution. It is available to pretty much everyone, even those with negative marks on their credit report.
    This is why a payday loan is often the only means some have of emergency credit. Without these loans, many would suffer the consequences of their lack of cash flow.
  2. In order to buy groceries.
    The fees on a hundred dollar loan are well worth it if you have no food in the house. That $100 loan could go a long way towards buying some inexpensive staples like rice, potatoes and even chicken.
    To stretch your budget further, go with an even cheaper source of protein like beans and shop specials. Check local adds to see who has items on sale. Look for loss leaders which are products that stores sell at or below cost.
  3. To pay for an emergency medical expense.
    Sometimes, the worst happens and it usually does when we are not prepared for it. If you need to pay for a doctor, a payday loan can get the job done.
    Perhaps you or a dependent has become ill or you need a dental procedure. Not getting these things taken care of is not an option but these things cost money. You can get you r money as soon as the next business day with this type of loan, making it an ideal choice for desperate emergency situations like medical ones.
  4. They do not want to borrow from friends.
    When it comes to money and friends, they do not mix. If you have money problems, the last thing that you might want to do is tell your friends about it. Even worse, you would hate to have to borrow cash from them. Many a friendship has been ruined by just this scenario.
    A payday loan will get you the money that you need so that you can avoid losing a friend. Your friend will never even need to know that you had money troubles at all because everything is handled discreetly.
  5. To pay for a vehicle repair.
    If your car goes down it has serious ramifications. You can not get to work, you can’t pick up your kids, you can’t get to the grocery store. The list goes on and on.
    A payday loan  can pay for your auto repair whether it be a new alternator, water pump or what have you. And, since you can get it quickly, you can get back on the road again. There will be fees with the loan but nothing like what you would use if you could not get to work.
  6. The lights are going to get shut off.
    Keeping the power on is extremely important and disconnect and reconnect fees can be very expensive. If you are days away from having the power shut down at your place, a payday loan can solve the problem.
    Once you apply for your loan and get an approval, your lender will begin working on getting the money to you. This can be as soon as the next business day. And, since it will be deposited right into your account, you can have immediate access to it. Keep the lights on and the heat or air conditioning going.
  7. Because they are discreet loans.
    An online payday loan is very discreet. You can get the money that you need without getting anybody else involved. In fact, you can do everything online from the comfort of your computer.
    Once approved, the money will even be directly deposited into your bank account, as soon as the next business day. You do not have to go anywhere, even to deposit a check.
  8. They are short on rent.
    If you are several hundred dollars short on rent, a payday loan could be just the thing. Cash advances are great as small dollar loans to help ends meet. If you just need a few hundred dollars, the fees on the loan would probably be less than late charges charged by your landlord or apartment complex.
  9. To avoid late fees.
    A payday loan or cash advance can pay any bill where late fees are high. It is up to you to do the math. Add up the cost of the loan and then compare it to the fees your other creditor would charge you. If the loan fees are less, the decision is easy.
    In addition to fees, also look at other drawbacks to not having the money. If you are about to be 30 days late on a bill, for example, you might be about to face a strike on your credit. A 30 day late can do a lot of damage, especially if you are trying to rebuild. A payday loan might help you avoid this.
  10. To pay for a holiday.
    It happens, the holiday is close and you need to pick up a few more things. Problem is that you do not get paid until after the holiday. This is the perfect situation for a payday loan because you know that you have the money to pay it back, it is just not here yet.
    For a fee, get your money now and enjoy the holiday. It will be a stress free situation because you know that you have the money to pay it back.
Posted by

James Car is a finance, loan and budget expert based in the United States. After attending Brookhaven college, he went on to become a successful entrepreneur. He now enjoys writing articles that help people save and make the most of their money.