Looking for a 1500 loan can be a somewhat frustrating experience - and it can be very difficult to find a good, honest lender who you feel is not going to take advantage of you. The main issue with 1500 loans is that mainstream banks don't usually offer such small cash loans, especially if you have bad or no credit history. As such, the payday loan industry has filled that demand gap, offering loans to people without requiring credit checks, and offering loans up to 5000. However, in this industry there are a few practices that have drawn the criticism of many activist groups - leaving many people how have bad credit but need loans to wonder if taking out a payday loan for 1500 is a good idea....or if it's a huge financial mistake. In this post we will try to provide you with sufficient information so that you can make that decision for yourself.
First off, you need to understand how payday loans work. They are very simple, which is one reason they have become so popular. You need to be able to provide and verify the following information to qualify for a payday loan:
- Prove that you are over the age of 18. You cannot be a minor and take out this type of loan.
- Have a valid checking account. Some lenders will require that you have the account active for at least 6 months, but this time period can and will vary according to each different lender.
- Have a job. Most institutions require that you make at least $1,000 per month in order to qualify for any loan, whether it be a loan for 2500 or a loan for 500.
- While no credit check is required, they will check to see if you are currently going through a personal bankruptcy filing or if you are currently defaulting on any other payday loans. If you are, then they will not extend the loan to you (although you could have had problems with both of these in the past, just not currently)
Second, you need to understand how payday loans are structured. These are NOT LONG-TERM FINANCING. Let me repeat this in another way - only use a payday loan for short-term financing needs. For example, if your car breaks down, and you need to borrow $1500 to get your car fixed, and your paycheck comes in a week, then this may be an option you can look at and consider. However, if you are simply wanting to pay off the loan over the next couple of months, then this loan is not for you and you need to find another way to get your $1500 loan. This is one of the biggest mistakes people make with payday loans, and is the main reason why so many politicians have issues with them - they feel that the lenders try to influence people to extend the 2 week loan into a 1-2 month loan and thus make a lot (a lot a lot) more money.
Finally, you need to understand the costs of getting a 1500 loan with bad credit. Simply put, there will not be a more expensive loan that you can take out. The average APR on such a loan is over 450%, which means that in order to borrow $1,500 for two weeks you will pay about $260, on average. Obviously, this won't kill you if you do it once because you don't have another option, but if you do it over and over again, then the fees will hurt you significantly.
Overall, just be smart when taking out any kind of 1500 loan - whether it be a payday loan or just a loan from a friend, there are always advantages and disadvantages of any type of loan. Hopefully this post has helped you understand a little more about your payday loan choices, and as such enables you as a consumer to make a wise decision with your money.