What Is A Salary Advance Loan?
We all have some cash emergencies we just can’t avoid. Maybe your car broke down, or you need to pay medical expenses, or you only have a couple of days of groceries left. In that case, an advanced salary loan might come as a useful solution until your paycheck arrives.
Filipinos are famous for their money spending habits, and their salary just slips through their fingers. Therefore, many of them resort to salary advance loans which solve their temporary financial troubles. Now, let’s see that these types of loans have to offer what are their terms and conditions.
Why do you need an advance salary loan?
To pay utilities – we are all aware that utilities have fluctuation tendencies. The electricity bill might suddenly increase, or you may miss a couple of payments and end up swatting flies at night, instead of sleeping comfy with an electric fan. Therefore, people apply for salary loans to avoid these uncomfortable situations.
Car repairs – you shouldn’t take an advance salary loan to finance your car payments. However, when unexpected breakdowns emerge, such as engine failure, discharged battery, or flat tire, then the salary loan can come as a suitable solution. Let’s not forget about your registration renewal.
Pay a debt – while salary loan isn’t an ideal alternative to fix your debt issues, sometimes we don’t have another choice. As you probably know, if you don’t pay your debts on time, they can double up and leave you in a big financial mess.
Avoid borrowing money from friends and families – a lot of Pilipinos value their pride and feel embarrassed when they need to ask for money. However, with advanced salary loans, you can avoid uncomfortable situations and fix your money problems.
Time-sensitive purchase – you might find we a well-paid individual, and yet an item you have been eyeing for months just went on sale. This way, you can actually save money by taking a salary advance loan.
What are the requirements?
To apply for a salary loan, you must be a 21-year-old Filipino citizen and currently employed. All applicants should provide a Government-issued ID, the latest salary slip, as well as billing proof.
The application process mostly depends on the lender. However, nowadays, the majority of people choose online lenders due to convenience. Make sure to find a reputable lender, and you will only need a couple of minutes to submit an application form, along with the necessary paperwork. In most cases, the loans are approved within 10 minutes.
On the other hand, if you choose a government institution, then this process might take some time, as the terms and conditions are much stricter.
How much is the interest rate?
Well, if you are lucky enough to find a lender who offers 0% interest, then your loan will be deducted from a salary. But, most of the lenders charge interest rates, and they can be surprisingly high. Often interest can reach 10% of your initial loan, along with the other expenses, such as processing fees.