In the US, many people live on minimum income and are dependent on Social Security to meet their life’s expenses. There may be times when they need an instant cash advance for unexpected expenses. In such situations, they can get online payday loans to overcome their financial emergencies. Show
Here’s some information on how SSI recipients can qualify and get online payday loans:Can You Get a Payday Loan on Social Security?Yes, you can qualify for a payday loan even if you are on Social Security. Fortunately, Social Security benefits qualify as a steady source of income, which makes you eligible for payday loans. What Do SSI Recipients Need to Request for Payday Loans?If you are on Social Security and want a payday loan, you must submit a copy of the Social Security
Award (SSA) letter to verify your source of income. You can request the income proof letter from the SSA directly.
Important Tips You Should Consider When Requesting for Payday LoansMany lenders offer payday loans to people who are receiving Social Security benefits. You should research different lenders before selecting a trusted one. Also, make sure you read the terms and conditions of the loan agreement and check the repayment model and fee structure before signing a loan contract. Choose a reliable and trusted payday lender that meets your needs. Be ResponsibleYou should only consider getting a payday loan when you need funds for an emergency expense. Payday loans must not be taken lightly. High-priced interest rates or fees and the short repayment time can leave you in another stressful financial situation if you are not responsible. Payday loans must be repaid within 2 to 4 weeks. Defaulting on loans could affect your credit score. Before getting an online payday loan, determine whether or not you will be able to repay the loan amount on time. Are you on Social Security benefits and need an instant cash advance to deal with unexpected expenses? Get started now! FaaastCashFaaastCash is a trusted online payday loan referral service helping people overcome their short-term financial emergencies. Our safe and secure online loan application makes it easy and convenient to get payday loans online. We have a large network of qualified lenders to increase the chances of approval for a fast cash loan. Pandemic Could Drive More Social Security, SSI Beneficiaries to Payday LendersEconomic downturn drives need for quick cash, but loans come at very high costThe downturn in the economy could push
more Social Security beneficiaries to take out high-interest payday loans, running the risk of getting
caught in a cycle of
ever-increasing debt. A payday loan is typically a short-term loan of less than $500 typically aimed at low-income individuals. Fees usually run between $10 and $30 for each $100 borrowed. If you borrowed $300, for example, you'd owe between $30 and $90 in fees. Borrowers write a check for the amount of the loan, plus fees, to the lender dated for their next payday. The lender cashes the check on the borrower's payday and collects their principal and fees. If you
collect benefits from the Social Security Administration (SSA) and can verify your payments, you're typically eligible for a payday loan. Payday lenders welcome Social Security beneficiaries because, unlike part-time workers, their payments are stable and reliable. And for many people, including Social Security beneficiaries, the loans are fast and easy to get. The convenience of payday loans comes with a high cost. A typical two-week payday loan
with a fee of $15 per $100 borrowed equates to an annual percentage rate (APR) of almost 400 percent, according to the Consumer Financial Protection Bureau (CFPB). In contrast, the typical credit card has an APR of about 16 percent, according to Bankrate.com. Some economists argue that payday loans can be a reasonable solution for
short-term cash crunches,
if you pay them off quickly. “The problem with these loans is when you pay off one loan and then you don't have enough money during the next pay period,” says Kimberly Blanton, who writes the
Squared Away Blog for the Center for Retirement Research at Boston College. “And so you borrow more." That's an expensive strategy. If in two weeks you can't afford to repay that $300 payday loan that came with $45 in fees, the borrower might suggest that you just pay the fees, rather than the principal of the loan. But by the next payday, you'd owe another $45 in fees plus the principal, meaning you'd now have paid $90 in just one month to borrow $300. "The
industry says, ‘Look, borrowers get to fix their car and go to work so they keep their jobs,” says Haydar Kurban, a professor of economics at Howard University. “The problem is someone who takes out 10, 12 loans a year. And the payday loan strategy is to land borrowers multiple times." For recipients of
Supplemental Security Income (SSI), a
program run by SSA to support certain people with little or no income, there's an extra danger. A loan doesn't reduce your SSI benefit, but any funds you borrow and don't spend will count toward the $2,000 resource limit for an individual (or $3,000 for a couple) the next month. If the value of your resources is over the allowable limit at the beginning of the month, you cannot receive SSI for that month. Payday lending jumps in hard times, and the U.S. economy has been crushed by the coronavirus. Although
economic conditions have improved somewhat
since the onset of the pandemic, when unemployment spiked to 14.7 percent, millions of Americans remain out of work, particularly those who held part-time or gig jobs. That's particularly bad news for those who rely on income from side work to supplement Social Security or SSI benefits. When the economy is booming, demand for payday loans is lower. In 2010 about 4.6 percent of Social Security retirement recipients younger than 66 use payday loans, according to a 2019 paper by Kurban. About
5.9 percent of SSI recipients in the same age group use payday loans. (Payday loan use is generally lower for older Social Security and SSI beneficiaries.) Will payday lending jump now that the economy is in recession? “I think that's a safe statement to make,” Kurban says. “Recessions are a time when people are looking for income, and when they lose that extra income, they resort to payday loans.” In 2010, as the country emerged from the worst recession since the
Great Depression, about 6.2
percent of Social Security beneficiaries younger than 66 used payday loans, and a whopping 21.9 percent of SSI recipients used them, according to Kurban's paper. See more Entertainment offers > In 2017, the CFPB found that there were more payday lending stores than McDonald's restaurants. Kurban doubts that's still true: States govern payday lending rules, and states have been imposing
stricter limits on the interest rates payday lenders can charge. Arizona, Arkansas, the District of Columbia, Georgia, New Mexico and North Carolina prohibit payday loans. Several other states limit payday interest rates at 36 percent. You can find the rules for payday loans in your state at the
CFPB's page on payday loans. Unfortunately, for people without a bank account, or people with poor credit, payday loans or other so-called alternative financial companies, such as pawnshops or auto title lenders,
are often viewed as the only viable choice for money in a financial emergency. Nevertheless, you should
seek as many alternatives as
possible before considering a payday loan. Examples:
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