Types of Cash Loans

Types of Cash Loans

There are several different types of loan companies out there, and you'll need to know which one of them is right for you before you get involved with any of them. You also need to know that there are also different types of cash loans that can be received, so you'll have to know what kind of loan you're trying to get and which companies offer that type of loan. The most common one is the payday loan. The collateral for that kind of cash loan is the paycheck of the borrower. There is more to it than that, however, because not everyone can qualify for a payday loan. There is an age requirement that varies by state and there are also requirements on how much money a person is making and how long that person has been at his or her job. The company might also want phone numbers of references and bank account information so that the company can direct deposit the loan money and direct debit the payments that the borrower will be making. These kinds of loans are becoming increasingly more common with the struggling economy.

Another type of loan goes on the car title. There are requirements in many states about these car title loans and there are restrictions placed on these companies in many areas. This is due to the fact that there were many shady and problematic companies who offered car title loans for a time, and they did this at ridiculous interest rates that no one could pay back. This was done deliberately so that the company would be able to take the person's car, which was usually worth much more than the loan was actually for. The most a person can get for a loan like this is far less than what their cars are worth. However, the person who wants this loan usually desperately needs it and assumes that he or she can pay back the money without a problem. Often, these loans go bad, and most people think that they should be avoided. In addition, there can be no bank or other lender's lien on the car, and the person must own it free and clear.

The third type of cash loan that's very popular today is a loan on a person's upcoming income tax return. A lot of people are getting money back from the government, but they aren't getting it right when they want to. They might need it sooner because of bills or something that they wanted to buy. They might even have an emergency. If this is the case, they can take their tax returns down to the loan company and show how much they will be getting back. Provided they complete all the paperwork and the tax return checks out as being acceptable to the loan company, they will loan money against the tax refund. However, as soon as that refund comes in it is the legal property of the loan company and must be turned over to them. A person cannot keep his or her refund check and just make payments with this type of loan.