|By David Pilley on February 7, 2011
Loans are available to everyone, and they come in all shapes and sizes. They are also given out by a myriad of people from A to Z. If you are looking for fast unsecured loans, you’re looking for a small loan with a short term. It may be simple to get, but beware the consequences if it’s not paid back on time.
The most well-known type of fast unsecured loan is a payday loan. This type of loan is offered in stores or on websites. They are not available in all states, but it is possible to get a loan online that comes from a company in another state. The amount of money you receive will be small, rarely exceeding $1,000.
There are really few qualifications you need to get this type of unsecured loan. Whether you’re applying online or in person, you need to supply accurate personal information, such as your name and proof of identity. If you’re in person, you might need your personal ID, while online you might need to supply your Social Security number. You also need to provide a copy of your latest bank statement, and you need proof of a source of income. Bringing your latest or the last two pay stubs will show this. (You’ll have to fax or send an electronic copy of this information if acquiring a loan online.)
Once this information is given, you will receive the loan from the company or it will be wired into your checking account within 24 hours. Now that you have the loan, you need to be able to pay it back. An advantage (if you consider it one) about getting a fast unsecured loan like a payday loan is that there is no collateral. You’re not at risk of losing your vehicle or your home if you default on the loan, and you need relatively little documentation to receive a loan. Many companies giving out payday loans don’t even check your credit.
However, the term of a payday loan is short. You have to pay back the money, plus interest, in full when you receive your next paycheck. Therefore, the term of the loan rarely exceeds two weeks and is a maximum of 30 days. Furthermore, the interest rate on these types of loans is sky-high, and if you’re in default for a few months, the amount of interest you have to pay will be more than the original loan amount! And you had better make sure you have sufficient funds in your bank account, because if your check bounces (or if the amount electronically taken out of your account causes an overdraft), you will be susceptible to bank fees. Some banks will charge a fee of 10% the amount of the bad transaction.
All in all, it is easy to get an unsecured loan, just like it is easy to play the card game blackjack. But, as blackjack is the easiest card game to win, it is also the easiest card game to lose. You could be losing quite a lot if you can’t pay back your unsecured loan on time.