A payday loan is a loan that is secured by either an actual physical personal check and/or a benefits(such as: SSI, disability, etc.) check.Generally you are required to furnish proof of verifiable income, residence, and various other information depending on the policies of the lender and state/local laws. Typically these are high interest loans due to lack of direct bank involvement. The term of the loan refers to the time you have to pay back the loan in full. Interest varies from state-to-state, there are also certain laws regarding:
-the minimum and maximum term of such a loan
-the interest of loan, which is may also be determined by the term of the loan
-the method of payment-to the customer, it may be in the form of a tangible check, cash, or direct deposit.
-payday loans may not be available in all states.
An Online Payday loan is a loan that is secured by job and/or source of income(such as an SSI, disability check, etc.) and an active checking account. As with a payday that you accquire from a branch/store, you are generally required to furnish information, such as: proof of income, bank statement(which may also be followed by a call to a system that verifies that the account provided is in fact authentic, active and in good standing; also the bank may also be call in addition to or instead of such an automated system). Depending on the company, documents may need to be faxed to them for processing, many do not require such a process. Upon approval, funds are generally direct deposited into the checking account provided.These loans are high interest loans due to the risk involved. Since, there is minimal person-to-person contact, generally, when applying for an online payday loan and/or during the application/approval period, there is arguably even more risk involved. With the increased risk, these loans may even have higher interest rates than branch-withdrawn payday loans. Law and policies surrounding online payday loans are very similar, if not identical to branch withdrawn payday loans. See above for laws and policies that will varies per state and/or local laws regarding payday loans. Online payday loans are preferred by some people due mainly for the convenience of an internet application and perhaps even to save from their own personal embarassment of going to a payday loan branch.
Pros of online payday loans:
*convenience
*provide handy cash for short term cash shortages.
*Rapid service-application, approval, funding are all relatively short processes.
*Availability from many providers
Cons:
*very high interest
*short-term solution