Online Payday Loans have many advantages,

but there can also be negatives,

including the cost, so it pays to shop around the online payday loans lenders and check the fine print.

There are a huge number of payday loans offered online, as a Google of "payday loans" will show.

In a way this is good, because it means there's plenty of competition for your business.

But the reality is that because of the convenience of the net, and the fact that online loans are not transacted "face to face", the internet is a very risky place for a lender. The internet unfortunately is a magnet for scammers and cheats.

The higher risks of operating online are translated into higher operating costs, and so you'll find that many (but by no means all) online payday lenders are more expensive than the neighborhood corner-store payday loan operation. The higher fees they charge compensate for the higher payday loan default rate. Sometimes there's even an application fee as well as the loan fees.

On the other hand, there are also online lenders who have developed good systems to weed out the cheats, and can therefore afford to offer payday loans at rates which are just as competitive as the corner-store lenders.

The beauty of an online payday loan of course is convenience. Armed with just your computer and your personal information, your online application can conjure up an instant cash loan within minutes, and have it in your bank account within 24 hours, more often the same day.

And with repayments recovered by direct debit, there's nothing else to do except make sure you have enough money in your account to meet the repayments. If your lender offers a No Faxing Payday Loan you won't even need to provide documents before getting the loan.

On the other hand, if you don't have a bank account, and want to get the cash in your hands immediately, the online loan solution is not as convenient for you as a visit to your local payday lending store, and waiting in line for face-to-face service.

In summary, compare the costs of both online and corner-store lenders, then weigh up the other pros and cons. Here's a quick check-list which might help:

ONLINE PAYDAY LOANS

Pros

• You don't need to leave home to apply
• You can contact your lender 24/7
• A good lender will be as cheap (if not cheaper) that the shop-front competitors
• It's usually very fast - often same day cash in your bank account
• Very private and confidential
• A no faxing payday loan lender will normally not need to get physical documents, or copies, from you

Cons

• Some online lenders are more expensive (depends on the lender)
• Transacting online doesn't give you a "face-to-face" customer experience
• You must have a bank account

This checklist is not exhaustive, but hopefully there's a few things to think about next time you are applying for an online payday loan.

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