Majority of lenders want a proof of identity, residence and employment. In order to qualify for a payday loan online (of any amount), you must provide two pieces of identification, utility bills and employment stubs. They verify all your personal data, check your credit score by getting your credit report, and then they are ready to make a decision regarding a loan.
When you apply for no fax payday loans online from direct lenders, you are subject to a completely different process. You are guaranteed not to have to produce any actual documents, either by fax or e-mail. The modern technology in the electronic era allows lenders to verify your personal information through various IT systems, which are less intrusive and totally objective. There are hardly any information left that can’t be obtained on a computer. Lenders can contact your employer electronically to verify your employment; they can contact your bank and landlord. You can live in California and get a loan from a no teletract payday loan direct lender residing in Texas or Florida. By sending a loan application, you consent to any type of verification the lender may choose in order to check your personal info.
Payday loan companies (sometimes referred to as loan sharks) often bypass certain checks, like credit check, for instance, but in general they will verify your credit history. They often use services of Teletrack or Telecheck to see if you have recently filed for bankruptcy, have currently any loans out or if you have problems with paying your utility bills. This is a “sort of” credit check, but it leaves no trace on your credit report. In general, payday lenders accept applications from people who have bad or even worst credit.
In order to be approved you must have an income from any source (military, pension, employment, benefits, etc.).
Other things to consider
Higher interest rates
Online direct lenders and loan sharks pretend to be a good friend to those who need cash in an instant. Since they do not require credit reports and other documents, they have a reason to charge a lot in interest. Borrowers, meanwhile, are either not aware that such rates are way beyond a normal limit, or they just do not mind paying that much on interest as long as they can get the money they desperately need and apply for payday loans from online direct lenders.
Many financial experts raise concerns regarding the use of online same day loans as the source of quick cash. The main problem that they see is an unusually high interest charged by online companies. This interest is justified by the risk lenders run when giving out money to borrowers who have high chances of defaulting on their instant loans online. Justified or not, there is no doubt that the high interest can pose a great deal of problem to borrowers.
Payday loan companies are smart enough to know that the longer it takes the borrower to pay off his loan back, the more they can earn from the interest on the loan. So what they do is make borrowers feel that it is okay to extend or renew their payday loans anytime they want. This is what makes such loans addictive and hard to do away with. With every renewal, borrowers are charged additional fees along with the high interest rates applied.
In summary, here are advantages and disadvantages of payday loans with guaranteed no fax or paperwork:
- Quick application process
- Faxless and paperless application
- Availability 24/7 (including Saturdays, Sundays and holidays)
- No collateral required
- Money directly in your bank account
- No standard credit check (the one conducted by banks)
- Quick funds at your disposal (loans in 1 hour)
- Higher cost of borrowing
- Maximum $1000
- Quick maturity date (usually maximum a month)