Have you ever needed some cash to pay an up-coming bill, an unforeseen expense or to avoid a bounced check while it's still a few days left before you get your pay check? In that case you should have a look at something called a payday loan (also known as paycheck advance).

Payday loans are simply small, short-term cash loans intended to cover your expenses until next payday (hence the name payday loan ). So the term personal short term loan could also be used for this type of loans. Some jurisdictions impose strict rules, but since the legislation regarding payday loans varies a lot between different countries and even between the US states it's completely impossible to cover all aspects in this article.

Since payday loans are extremely short-term (only until your next payday), the difference between APR  and effective annual rate (EAR) can be substantial, so it's important that you know if the lender means APR or EAR. For example on a 2-week payday loan with an interest of 15% the APR would be 390% (26 x 15% = 390%), but the EAR is horrible 1.15²⁶ – 1 × 100% = 3686%.

The loaning process works usually so that you visit a lending store, where you write a post dated check as payment for the loan + interest. On the pay day you're expected to visit the store again to repay the loan in person, but if you don't the lender will process the check withdrawing the money from the borrowers checking account. If the checking account is short on money the borrower will face a bounced check fee from their bank in addition to the costs of the loan + in some cases even extra fees from the lender.

ThinkCash is one of the companies offering short-term personal loans in the range of $250 to $2,500 for emergencies like when the bills have to be paid or you need to avoid a bounced check. The difference between ThinkCash and other similar companies is that their rates are typically 25-75% lower than other payday loans and they offer convenient payment options like for example to pay your loans in several installments or pay off everything at once without penalties.

The application process is as simple as it can be. You fill out the application form on their web site and, if approved, the money can be wired to you the next business day so you don't have to wait for a check to clear any bank accounts .

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This entry was posted on Tuesday, November 11th, 2008 at 9:44 pm and is filed under Finance, Review. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.