Introduction
Before we learn about the benefits and disadvantages of the check loans we have to have a clear idea about the concept of check loans. There are many different types of check loans like no document check loans and no credit check loans. These loans are a boon when you need to get money urgently. These loans do not have a lengthy process for approval. They are easily available and quick.
The benefits of these loans
There are many different benefits of no document check loans. The main benefit is that you are not required to submit any document to avail these loans. You are only required to have a bank account. You have to be a full-time employee and will be required to show proof of employment. You also need to be above 18 years of age. You will get the cash within 24 hours of applying. People with low credibility can get these loans. Individuals or firms, whose credit report shows them as passed bankruptcy, can also avail these loans. These loans can be processed online and do not require any paperwork. All these factors make no document loans, and no credit check loans are a favourite of needy citizens. However, this does not mean that there are no drawbacks to these types of loans.
Drawbacks
What are the drawbacks of these loans? The main drawback of no check loans is the very lofty interest rate that is charged. Since no collateral is provided as security the lenders charge a very elevated rate to equate to the high risk factor. In most cases, the interest rate is not clear to the person taking the loan. The lenders advertise the loan as a fixed fee loan. They will tell the client about a fee that is charged for every hundred or thousand dollar that is borrowed. When we calculate and figure out the amount that you have to pay you will realize that the rate of interest charged is much higher than the interest charged by the other banks. Since the risk factor involved with no such loans is high the lenders do not lend money for an extended period of time. The loan will have to be closed within a very brief span of time. The time period can be as concise as a day.
Tips
How much money can I borrow? Due to the risk factor involved with no check loans you will not be able to get large amounts as no check loans. Generally, $1000 is the highest amount that you can get. Rarely does the amount go beyond $1000. The maximum amount that you can borrow through these types of loans is $2000. Even though such loans do provide an instant solution to major money problems that may arise unexpectedly, they have to be treated only as a last resort. It is always better to get loans from well-known banks after all the credit verification processes. You may have to provide collateral as security too. Still these loans are better as they are available for a much lower interest rate.
