Being in a situation that requires access to funds that are not available can be extremely stressful for people. Financial burdens and pressures are often ranked among the leading causes for divorce and stress-related illnesses. The good news for people that live in a paycheck to paycheck financial world is that there is a solution when emergency cash needs arise.

Payday loans are short-term loan product designed to help people faced with the situation just described. Lenders offer consumers access to quick cash, or direct deposit funds, in exchange for a moderate fee and a modest repayment term. Fees for payday loans are usually a little higher on an APR comparison with other loans. This is because the loans offer convenience in a time of need, and lenders often take on greater risk from the loans. Because of the speed with which most payday loan customers need access to funds, lenders often use a much less restrictive application process in order to accommodate customers. This increases their risk, and thus the costs.

While the fees associated with the loans do not justify their use for non-essential purchases, payday loans do offer huge opportunities for people faced with emergencies. Common uses of the loans include unplanned car repairs, unexpected or high bills, and any other short-term cash need. As the name suggests, a payday loan is offered as a short-term funding need in advance of a paycheck. Thus, repayment periods are usually shorter, most of the time a matter of a month, or a few months at most.

Loan amounts vary depending on the borrower's qualifications as well as his relationship with the lender. Most lenders have a maximum initial loan amount, which is gradually increased as the borrower builds a relationship and credit history with them. As many lenders now operate online, the application and approval process for the loans is extremely convenient. Many lender sites promote instant approvals based on the borrower's credentials and predetermined set of decision criteria. This means a prospect could apply and get an automated approval in moments with some companies.

Often, companies promote payment within one business day for approved loans. This is important, as the borrower is looking to meet an emergency need. Borrowers need to be responsible with use of this type of loan. It is of great benefit to people in true need, but it is not a good source of low-cost funding for fun purchases.