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Instant Approval Cash Loan

One of the reasons why cash loans are so popular is that many cash lenders offer instant approval. A person can give some basic information and know almost immediately if they have been approved for a loan.

Unlike banks and other traditional lenders that can take days or weeks to approve a loan, cash lenders can approve a loan instantly. Cash lenders are able to do this because they charge very high interest rates and tack high fees onto their products. The added profit from these fees and higher interest rates offsets the risks they take by approving loans instantly.

Another drawback to instant approval cash loans is that the amount of money available is often very limited. A person may only be able to borrow a few hundred dollars from such a lender when a traditional lender might make several thousand dollars available.

How an Instant Approval Cash Loan Works

The way an instant approval cash loan works is very simple.  The lender asks the borrower a few basic questions and if the borrower can answer them the lender advances the funds.

Generally, the main thing a lender will ask for an instant approval loan is if the borrower has a steady source of income such as a job or government benefit payment. Many instant lenders will want to see some paperwork that verifies this such as a pay stub or a bank statement. It is also common for lenders to call the borrower’s employer to verify employment.

Since the lender is only asking for very basic information no background checks are necessary. This makes the process much faster.

Advantages of Instant Approval Cash Loans

The biggest advantage to an instant approval cash loan is that the borrower can get the funds almost immediately. This makes an instant approval cash loan an excellent source of emergency funding for average people.

Many people turn to such loans because they are quick and easy to get. The amount of paperwork required is minimal and people don’t have to spend a lot of time with a lender.

Online cash lenders can operate even faster because they don’t have to meet with the borrower in person. Instead the funds are quickly sent to the borrower’s bank via electronic funds transfer.

Drawbacks to Instant Approval Cash Loans

The biggest drawback to an instant cash loan is the high costs associated with it. Lenders will generally charge a very high rate of interest and often tack high fees onto such a loan.

This means that a person could end up paying quite a bit of money for the convenience of instant approval. The interest on a $500 instant approval cash loan could add up to $100 which means a person will have to pay back $600.

Even though instant approval loans can be taken out very quickly, a person should think long and hard before taking one out. The costs can quickly add up and eat up whatever funds a person has left.