Are you contemplating a payday loan to cover unforeseen expenses? The following article will highlight certain things you should consider before finalizing one. This checklist might just help you make a smarter choice – you may even save some serious money.

1. First things first – Do you really/actually/desperately need a payday loan? You might need cash right away, but have you considered other possible options? The fact is that a payday loan is an awfully expensive source of money – with Annual Percentage Rates (APR’s) varying from 250% to 1000%. Therefore, before you apply for one, see if you can organize money by taking an advance from your employer or from your credit union. If push comes to shove – You could consider lending money from friends or family. A payday loan should be your absolute last resort.

2. Examine yourself on how much you actually can repay when your next salary comes around. Try to work it down to a specific number (amount) you CAN commit to. Take a cash advance only for the amount you are able to repay, considering all additional charges as well. Try to obtain funds from other sources for any additional requirements you may need.

Why? - Because if you decide to roll over all, or part of the payday loan, you end up paying much more for late fees and additional charges. Once your APR’s start climbing, you may even find yourself locked in a horrible cycle of payday loan debt. Try your best to avoid this pitfall.

3. Apply for only one payday loan at a time. Applications get reported to a consumer tracking databank used by banks and payday borrowers. Once you apply for several loans, the lenders might see the multiple applications and you could possibly get rejected by all of them.

4. Examine the lender’s approval conditions meticulously. Only apply to a loan option you are able to qualify for. Once you apply to an institution that has a strict approval criterion and get rejected, your chances of getting approved by another company with more relaxed criteria are greatly diminished.

5. If you are applying on the internet, ask yourself if the institution’s website is professional and well-organized. Do they have clear information and guidelines on the website? Is there a comprehensive Frequently Asked Questions page? Are there any testimonials from clients? Are you able to contact the firm/institution directly?

A vital point to remember – Does the website have an SSL certificate on the application page? This simply means that data is being transferred securely. All secure pages have a web –address (URL) that starts with "https" instead of "http". Furthermore, you will see a padlock symbol displayed in your internet browser. If any financial institution is using a non-secure page to collect information from you, immediately find another lender.

Acting on the above-mentioned points will help you make more informed decisions concerning payday loans. Ideally, the best solution is to get your finances into great shape so that you don’t ever have to borrow money in case of an emergency.