How do payday loans work?
Many times we find ourselves in need of a loan in order to face economic unforeseen events. We may need more liquidity at certain times. See e-rtl.org for an illustration
However, it is likely that we do not have a stable payroll. Aglo more than usual in the current job landscape where jobs are often very unstable. For these types of clients there is a very effective solution: loans without payroll.
From Private Lenders we will explain everything you need to know about loans without payroll. Are you ready? In that case, let’s do it.
What are payday loans?
As a general rule, loans without payroll are those offered by financial institutions without the need to have a payroll as collateral for the operation.
Traditional banking is usually not a friend of this type of loan because payroll is one of the safest guarantees that customers can request. Hence, many entities oblige clients to domicile the payroll in their entities in exchange for the granting of a credit.
However, there are certain financial institutions that offer fast loans, not very high, for those people who need to have capital and do not have a fixed payroll.
Having to meet fewer requirements to apply for them, they tend to be much faster than other types of loans.
Despite the fact that they tend to have loans of not very high amounts (as a general rule they do not exceed $ 1000), there are certain borrowers who offer loans without payroll but in exchange for other types of guarantees. These loans can reach truly high amounts. Even more than $ 300,000. In these cases, the borrower needs to have another type of guarantee other than payroll. They usually request real estate for this type of loan as a guarantee.
What are the requirements to apply for a loan without payroll?
As a general rule, borrowers request to have a regular source of remuneration to be able to offer these loans. The difference is that it does not have to be a payroll. In other words, alternative sources of income other than the classic payroll are considered valid. This allows retirees, pensioners, freelancers or people who collect unemployment benefits to access this type of loan.
When the income offered to apply for a loan does not correspond to a payroll, they must meet the following requirements:
- That they are monthly or periodic income. For financial institutions to agree to grant these loans, a periodicity of income is required. It is not worth having a month of capital and not having an income in the account until after six months.
- That they can be justified. The higher the amount requested, the greater the requirements of these loans without payroll. As a general rule, some type of official document is usually requested to justify and demonstrate the frequency of this admission. For example, in the case of the self-employed, a declaration of income or VAT is usually requested.
Are there different types of loans without payroll?
Effectively, that’s right. There are different types of loans without payroll depending on the economic amount. A few lines above we have explained that the most common are those fast loans of small size. But there are other possibilities with a greater capital contribution. Among the most popular varieties are:
- Personal loans for projects that need more capital.
- The mini loans without payroll, ideal for obtaining liquidity at specific times. Many of them, like Vivus, offer a first loan of $ 300 without any interest for new clients.
- Consumer credits
- Use of credit cards
- P2P loans