Why are People Being Denied Payday Loans?

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People Are Denied Payday Loans- Heres
Why! Payday loans are a means for rescue when one
is short on money and cannot apply for a
traditional loan for various reasons. When one
gets rejected by other lenders such as
conventional ones due to not being able to offer
collateral or due to having a bad credit rating,
they opt for payday loans since these loan
lenders are more lenient than the others.
However, do payday loan lenders offer cash
advances without any terms and conditions? Lets
first have a look at scenarios in which they do
offer loans Bad credit A huge number of
Americans possess credit scores that are average
or below that. That means that they hold credit
ratings below 600. This can make it difficult for
them to get a loan from a traditional or a
conventional lender. Traditional lenders often
reject borrowers whose credit scores are below
600 since they depend on the previous financial
transactions and repayment histories of borrowers
in order to come to a conclusion about whether
they qualify for a loan with them or
not. However, payday loan lenders do not depend
on ones credit rating in order to offer a loan
to him/her. Thats because they do not believe in
ones past financial transactions and repayments
in order to give them a loan. They instead ask
for the individual to have a stable monthly
income which is the main factor that determines
whether or not one can receive a loan from
them. Collateral If a bad credit holder seeks a
loan from a traditional lender, it is most likely
that the lender will turn own the request.
However, average credit rating holders can get a
chance to receive a loan from these lenders
provided they have something to offer as
collateral. That means, they have to put
something as valuable as a car or their house at
stake in order to get a loan from them. Not
everybody has a vehicle of their own or a house
that they own to offer to a lender as security,
which makes it difficult for them to get a loan.
However, payday loan lenders offer unsecured cash
advances to their borrowers. This makes life easy
for those who have bad credit but nothing to
offer as security or dont want to risk something
by putting it up as collateral. Again, as long as
the borrower has a stable income, it shouldnt be
a problem for the lender to offer him/her a loan.
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Now, lets look at situations wherein payday loan
lenders deny loans No stable income From the
very beginning of this article, we have been
enforcing the idea of one having a stable income
in order to receive a loan from a payday loan
lender. Thats because thats the main
requirement in order to receive a loan from them.
If one doesnt have a stable income, he/she shall
not qualify as a trusted borrower with a payday
loan lender. Payday loan lenders concentrate on
the current financial status of the borrower in
order to lend a loan. So, if there is no monthly
income which is stable, there is no chance of one
receiving a loan from them. Bank account This is
majorly directed towards online loan lenders.
Online payday loan lenders require their
borrowers to have a checking account through
which they can both deposit as well as withdraw
cash. The whole idea of applying for an online
loan is to avoid the hassle of paperwork and more
that comes with applying with a store-based
lender. Online loan lenders also like to avoid
the hassle of not being repaid on time, which is
why they withdraw cash from your account on the
due date. Of course, they do inform their
borrowers before doing so, but it is a much more
convenient option even for the borrower who gets
to avoid keeping a track of the due date as well
as travelling to a store just to pay back a loan.
In order to have a smooth lending and borrowing
experience with a payday loan lender whos based
online, it is important for you to have a valid
checking account.