Yes, it is possible to both apply and receive a loan on the same day. This is typically more common with online loan lenders. However, some banks and credit unions may also offer same day loans to their customers.
What are Same Day Loans?
Same day loans refer to loans that can enable the prospective borrower to receive funds on the same day that they had applied for the loan. It is important to note that same day loans can prove to be a very expensive way of borrowing money as they are typically short-term.
Payday loans are a popular example of same day loans. Payday loans have some of the highest annual percentage rates on the loan market, especially in comparison to typical personal loans. As such, payday loans should only be sought after in certain instances.
If a prospective borrower is able to wait longer than a day to receive the funds that they have applied for, then this is typically a better option for them as it will open up more competitive rates available.
What are the Different Options Available for Getting a Loan on the Same Day?
There are a number of different same day loans available – all of which enable prospective borrowers to receive funds on the same day that they are approved by the lender for the loan. These include the following:
- Payday Loans
Payday loans are essentially loans that can allow borrowers to hold out until their next payday, intended for any unexpected costs that may arise in between paycheck dates. This could refer to instances of emergency home repairs or medical bills that require very fast access to additional funds.
Payday loans are typically limited on the amount that you able to borrow, and interest as well as additional fees will be charged on top. They do not require hard credit checks, making them a good fit for those with low credit scores who may not be eligible for other types of loans or funding.
Due to the short-term nature of payday loans, as well as high annual percentage rates charged on top, many payday loan borrowers cannot repay the loan by the initial due date. As such, the loan is rolled over, and interest accrued which can lead onto cyclical debt for the borrower.
- Title Loans
Title loans allow prospective borrowers to receive funds on the same day of applying by deeming their vehicle as collateral. This makes title loans secured as the loan amount is secured to the value of their vehicle.
In the repayment period, the lender will essentially own the vehicle. If you default on the title loan repayments, your car could thus be repossessed by the lender.
Title loans typically do not require a hard credit check so can prove to be popular amongst those with low credit scores who own their own vehicles.
It is important to note that similarly to payday loans, title loans can charge high interest rates and additional fees. Further, there is the risk of losing your vehicle if you cannot make the repayments in full and on time.
- Pawn Shop Loans
Pawn shop loans are another type of same day loan that will allow prospective borrowers to use their items of value as collateral to get approved quickly for funds. This could include jewellery, electronic devices or antiques which could potentially be pawned for money.
A pawn shop will thus provide you with funds that equate to the value of your item and will keep hold of it until the loan is paid off in full and on time.
Pawn shops will charge prospective borrowers with additional fees and there is a risk that you may not receive your item of value back if you cannot repay the loan in full and on time.
Are There Any Alternatives to Same Day Loans?
If you do not need same day access to funds, it is important to remember that there are a number of alternative options available for consideration. These include the following:
- Credit Advance
Credit card holders may be able to take out a cash advance from their bank, credit union or cash point. This will provide them with immediate access to cash.
Cash advances typically incur high interest rates and fees, although not as high as same day loans.
- Borrowing Money From Family or Friends
This is a great option to avoid the high interest rates and additional fees charged by banks, credit unions and loan lenders. However, it is important that if you choose to follow this route, you should provide your family member or friend that you are borrowing funds from with a clear repayment plan.
- Speak to Your Employer
It may be possible to advance your wages or paycheck if you are in need of emergency funds. This can help to avoid the high interest fees or additional fees associated with taking out a same day loan.
You should thus speak to your employer to see if you are able to receive a portion of your wage earlier than your payday.