The Decision: How Much Can You Afford to Borrow?
One of the problems consumers frequently encounter with no fax no credit check payday loans is over-borrowing. When your request is too high, you bury yourself in interest charges and risk getting caught in a cycle of debt. On the other hand, if you don't borrow enough, you might not be able to take care of all of your bills before your next check comes. Read on for suggestions on how to determine the size of the advance you can afford.
Evaluate Your Monthly Income
Your income is one of the best indications of your borrowing capacity. Generally speaking, the more you make each month, the more you'll be able to take out. Ideally, you should not take out more than the amount of your next check. You should also allow for finance and interest charges in your original loan. In other words, your next check should be able to cover the entire balance of your debt you took on.
Assess Your Debt Obligations
No matter how high your income is, you won't be able to afford an advance if you have a significant amount of other debt to handle as well. For example, if you have a very high mortgage payment or rent, you should be conservative when requesting funds. Similarly, take into account the amount of credit card, car loan, and other debt you have to take care of. Will you be able to afford your minimum payments on all of these debts if you add an advance into the mix? Your total debt obligations (excluding housing expenses) should not exceed more than 15%-20% of your gross monthly income.
Your Lender's Maximum Lending Amount
Although the size of the advance your lender offers should not have much bearing on how much you borrow, it will affect how much you are capable of handling. For instance, some lenders will not issue advances larger than $1500 no matter how much the borrower makes. With other lenders, the maximum amount is as small as $500 (varies accordingly). Your income will directly impact how much money you can get. The more you make, the larger the amount your lender will be willing to give to you. Remember that even if you qualify for assistance, you should only request as much as you absolutely need to get by.