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Do you need extra cash to tide you over to payday? Several apps are eager to provide that service by marketing themselves as an easy, no interest way to get a small loan.
However, not all cash advance apps were created equal. Before signing up for one, research it first and watch out for hidden fees and other pitfalls.
Consider the following tips before you use a cash advance or payday loan app:
- Understand how cash advance loan apps work. TheCollegeInvestor.com defines cash advance loan apps as, “apps that allow you to deposit money that you’ve already earned into your checking account before payday.” Some cash advance apps work based on earned wages by partnering with employers, while others work directly with consumers. After calculating your current earnings, apps grant you a small loan. The amount of your loan is then deducted from your next paycheck. Some apps require monthly membership fees. Others charge fixed fees for loans or allow you to make voluntary “tips.”
- Get to know the lender. If you decide to use an app to get a cash advance, look up the financing company on BBB.org first. Make sure the company has a reputation for honest business practices. In addition, ConsumerFinance.gov recommends finding out if the lender is licensed by your state, which…
