We’ve all fallen short of funds every now and then. Even individuals with full-time jobs find themselves stretching money until the end of the month. That’s what makes the idea of payday loans so convenient and lucrative. The information below provides a crash course on how this type of loan works and the benefits and drawbacks.

What are payday loans?

The concept of the payday loan is popular these days. Commercials on television, radio spots, websites and plenty of online advertisement are devoted to this business. To put it simply, a payday loan is a short-term loan that allows a person to get a cash advance on short notice. The keyword here is a "short-term loan," not something you want to treat like a credit card. The majority of the time, the funds can be deposited into an individual’s bank account within 24 hours. However, because it is a loan, the amount of money borrowed from the lender must be paid back with high interest rates in most instances.

The amount of this small unsecured loan usually ranges from $100 to $1,500, which is designed to meet the financial needs of the borrower until their next payday. Essentially, people make a check for the advanced loan amount, plus whatever the company's fee is and it is held until the customers next payday.