Payday loans are a new idea in money loans. Payday loans are based on the concept of getting a small loan for emergency expenses until the next payday when the loan is paid back. Payday loans, however, can lead to a vicious cycle of debt if a person does not completely understand how they work.

Payday loans are obtained through a rather simple process. There are no credit inquires and the requirements are usually only a checking account. A person fills out a simple form and provides documentation of a checking account. The loan is then processed and the person writes the payday company a check to cover the loan and applicable fees. The check is then held for an agreed upon amount of time, usually two weeks, and then is either cashed or the person can come back and pay the check amount in cash. This easy process is what draws many people to payday loans.

Payday loans vary in amounts depending upon a person