If you're like most people, emails with those subjects show up in your mailbox regularly. The subject is online payday loans - short term personal loans that you can apply for online. Generally, online payday loans are unsecured personal loans made to people who need a 'bridge' to get them through to their next payday.

Because of the small amounts of the loans extended by online payday loan companies, the companies that make short term personal loans online seldom do a credit check. That makes them the ideal short term loan for those who need a quick loan but don't have the credit score to qualify for a more traditional cash advance.

No matter what method they use for repayment, the one thing online payday loan companies have in common is their high interest rate - but those rates can be deceptively high, especially if the loan is small. That's because online payday loan companies are required by law to quote their interest rates as an annual percentage rate. You may borrow $100 from an online payday loan broker and agree to repay $125 within 14 days. When that's expressed as an APR, it's in the neighborhood of 650% - a totally outrageous interest rate - if you were actually going to take a year to pay it back.

But even so, why would someone even consider paying $25 to borrow $100 for two weeks? Many borrowers who take out online payday loans have bad credit ratings that prevent them from qualifying for cash advances or other types of unsecured loans. For others, an online payday loan is their only option because most traditional lenders won't consider loans for less than $1000. Still others turn to online payday loans for emergency situations where time is important. A traditional lender can take several days to approve a personal loan. If your car is in the shop and you need it to get to work tomorrow, several days is a luxury that you can't afford. An online payday loan company will often have your loan in your hands within a few hours.

Online payday loans can be a blessing when you need cash in a hurry. Choose the company you deal with wisely, and make your payback promptly and you can avoid turning the blessing into a curse.