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That is when the pay-day loan becomes a genuine lifesaver! The Way The Pay-Day Loan Works Payday cash loans are little, short term loans given by lenders who charge a designated, once fee. The loans granted are usually around $500 -$1,500. Unlike regular long term credit loans, the length of the unsecured guarantor loan is short - sometimes till your next pay check, or around 1 month - thoughsome lending firms are much more flexible with this, based on their lending policy.