If you are strapped for cash and just need a few hundred dollars to make it to your next payday, a payday loan might sound like the financial tool you need. Understanding more about how to get a payday loan and the common repayment options for these loans is the first step in potentially solving your current financial challenge.
Find out more about payday loans below, including how to get a payday loan online. Plus, find out about installment loans, an alternative to traditional payday loans with more flexible terms that might be right for you.
What Do You Need to Qualify for a Payday Loan?
The requirements for payday loan approval vary depending on your lender and what state you’re in. Payday loans are regulated by the states, and each has its own rules. Lenders may also have their own policies, with some asking for more documentation than others.
In general, traditional payday loans don’t require good credit. In fact, most lenders for these loans don’t even check credit. Some common basic requirements for payday loans include:
- A valid and legal form of ID. Your driver’s license will usually suffice, but you may also be able to use another form of state-issued ID or even a passport ID. Check with any potential lender about ID requirements so you know whether you can meet this requirement.
- A qualifying checking or savings account. You need a bank account in good standing that can receive the funds from the loan as a deposit and be used to pay back the loan. Typically, payday loan lenders require you to sign an agreement that allows them to automatically withdraw your funds to make the payment when it comes due.
- Proof of income. Most commonly, payday loan lenders look for paycheck stubs showing your most recent paychecks. This helps them understand how much your next paycheck is likely to be. In some cases, payday lenders might accept other forms of income documentation, including W2 statements or bank statements showing direct deposits from your employer.
- An address. You must have a legal address. Some payday lenders may not allow a PO Box. The reason payday lenders require an address is that you must reside in a state where they can legally issue a loan. Not all lenders can issue loans in all states.
- Phone number. Lenders usually want a way to contact you if there are any issues with the loan or repayment of it. Payday loan lenders typically require a working phone number and may also ask you for an email address or other forms of contact.
How Do You Apply for a Payday Loan?
You apply for a payday loan by gathering all of the required documentation and information listed above and completing an application. If you’re asking, “where can I get a payday loan?,” the easiest answer is often online. You can also find some in-store payday loan locations and apply in person.
Either way, payday loan applications typically only take a few minutes to complete. Online payday loans are even more convenient because you don’t need to get dressed, leave your house or drive anywhere to apply for one. You don’t even have to wait until normal business hours, as you can apply online 24 hours a day. That may help provide some peace of mind if you’re worried about a financial matter late at night and looking for a potential solution before you go to bed.
How to Get Approved for Payday Loans
Payday loans don’t usually require good credit, and, in most cases, the lender won’t even pull your credit report. So you don’t need to worry about your credit score or disputing inaccurate items on your credit report to bring that score up for the purpose of getting a payday loan. However, you do need to meet any requirements set by the lender and local government regulators.
You can find out more about the requirements for a payday loan by researching potential lenders. Look at their sites to find out what might be required for a loan and how they manage loan processes. The application page may also give you some information about what is required to apply for and be approved for a payday loan.
Take care when you’re completing your application. While payday loans may be fairly easy to get approved for in comparison to some other types of credit, a typo or incorrect information on your application can still lead to a no.
Once you complete your payday loan application carefully and submit it, documents are usually processed quickly. You’ll likely know whether you’re approved for a payday loan the same day, and in many cases, may know the status of your application in just minutes.
Payday Loan Repayment Options
Payday loans are repaid in a single lump sum, and the lenders typically don’t leave any more room for risk than they have to. That means the repayment options are automated to some degree, allowing the lender to process the payment even if you take no action yourself on the due date.
One common option is that lenders have you write a check for the total amount to pay back the loan. The payday loan lender holds that check, depositing it on the date that your payment is due. You have to ensure that you have enough money in the account at that time; otherwise, the check is returned for non-sufficient funds. In that case, you still owe the money — and likely additional NSF fees — and the lender might turn the account over to collections. While payday lenders don’t check your credit — and the loan and your payments don’t usually show up on your credit reports — a collections account does get reported and hurts your credit.
The other common payday loan repayment option involves signing an agreement that allows the lender to take the money for the payment directly out of your bank account. The lender is only allowed to take the exact amount you agree to and can’t legally take it before your due date. You’re responsible for ensuring the amount is available on that date. If the money isn’t available, the same NSF and potential collections scenario can occur.
Where Can You Get a Payday Loan?
You can’t get a payday loan in every state. Some states prohibit payday loans; if you live in Arizona, Arkansas, Georgia, New Mexico, North Carolina or the District of Columbia, you won’t be able to get a payday loan. You may be able to seek other options, such as a small personal loan.
If your state does allow payday loans, you can look for lenders online or off. To find in-store lenders in your area, start with Google or ask for referrals from people you trust. You can also search for online payday loan lenders by starting with the search engines. However you look for payday loan lenders, conduct research to find out whether potential lenders are legitimate and responsible.
Some red flags to look for include:
- The lender asking you for money. Legitimate payday loan lenders don’t ask you to pay fees upfront; they take the fees out of your payment.
- Unclear terms. Lenders are required to disclose fees, interest rates and other terms of the loan. If the lender refuses to provide this information in writing or answer questions you have, you might want to consider another lender.
- Problematic communication. If you can’t get someone to call you back or answer your legitimate questions, you may run into communication problems during the short term of your loan.
You may also want to look for a responsible lender. Responsible lenders work to provide loans that meet your needs without putting you in a financially impossible situation.
Payday Loans vs. Installment Loans
The total amount of a payday loan comes due in just two to four weeks. Typically, the total amount ends up being paid out of your next paycheck, which can leave you floundering financially in the near future. But payday loans aren’t the only way you can get fast cash for urgent matters. In some cases, an installment loan might be a better option.
| Payday loan | Installment loan |
| Can only borrow a limited amount — in many states, payday loan amounts are capped at $500 | Amount you can borrow varies by lender and your financial situation, but is often more than it is with payday loans |
| Total amount due in a single lump sum | Payments are broken up into numerous installments, making each payment smaller and easier to deal with |
| Loan must be repaid within two to four weeks | Loan payments can be stretched out over months or even years, depending on the terms of the loan |
| Making your payment on time doesn’t help your credit | If the lender reports timely payments to the credit bureaus, making your payments can help you build a positive payment history |
Frequently Asked Questions
Speedy Cash Can You Check Your Credit?
Many lenders will require credit checks in order to protect you from being scammed or for people who may not be eligible for financing. But will they increase your chances to get approved for a mortgage?
The short answer to this question is yes. There is evidence that consumer reports helped millions of Americans get home loans by avoiding predatory lending practices.
However, consumers should also be aware that these reports can cost money, which may deter borrowers from applying for financial services.
Apart from a lender reviewing your file, credit scores can also be affected. Your score can drop if your payments are not on time or you miss several months of payments. This makes sense since missed payments reflect lousy credit history.
You should be aware that not all lenders will review your credit report before authorizing you for a loan. While some lenders will only review your credit report once or twice, others may not even look at it.
Before signing up for any type of loan, ensure you understand what information is being reported about you. Are you willing to give out any financial information?
What should I consider if I’m thinking about getting a payday loan online?
Knowing what you are signing up for when you do a payday loan online is essential.
Different options are available depending upon where you live, your budget and what you can afford.
You must carefully research all the details of the company you’re applying to. You should not sign anything if they don’t give enough information.
These are some of the things you should look for before taking out a payday advance.
- Information about their fees and penalties as well as repayment terms
- Contact information such as phone numbers, email addresses, or website address
- They must show proof that they have the right to operate in your state
- Details about additional services they offer (such as fax-less payday loans)
- You can contact them directly via their site using the contact form
- The ability to cancel your agreement without penalty
- There is still a chance to get a loan, even if your current lender isn’t interested.
- When your application is approved, how quickly will you get funds?
- Guarantees that they won’t charge extra fees or add any charges later
- How long it takes you to repay your loans
- What happens to your payments if they aren’t made?
- Your right to dispute the debt
- If there is a problem with their loan, they can sue them.
- What percentage of your payment history will they report to a collection agency?
- Their policies on late payments and defaulted loans
- The time they keep your records
- What kind of customer service they offer
- How quickly they respond to messages
- What happens if they close down
- It’s so simple to find another lender
- What do you do if you have a problem
- Where do they stand on charging hidden fees
- How do they address identity theft issues?
- What happens when something goes wrong?
- What kind of security measures do they use?
- Does the company require you to be a resident of certain states
- Do they perform third-party checks
- Are they BBB certified?
- Are there any complaints that have been posted?
- How to complain or file for a complaint
- What laws protect consumers using online lenders
What is the easiest way to get a loan with bad credit score?
The best way to find a payday lender is by asking around at your local community bank. If they know anyone who may have an account at the bank, they are often very helpful and willing help. You don’t have to ask them directly. Instead, you can search online for “payday lenders” and you’ll be able to see what I mean.
Google can also help you search for “payday lender”. You’ll likely be directed to websites offering payday loans. But be careful!
How much does it take to get $1000 loan from a payday lender
A typical loan from a payday lender would cost about $300. The actual amount depends upon several factors:
- Your current balance
- How long you have had the loan
- The number of due payments
- It doesn’t matter if principal or interest are being paid back
- Late fees may be charged
- What type of loan (i.e. cash advance vs. an installment)?
- Any additional charges such as application fee
- Tax rate
- State laws regarding payday lending
- Other fees that the lender may impose
- Interest rate
- Conditions & Terms
- Repayment plan
- History of payments
- Credit score
- Ability to repay
- Current income
- Situation on the job
- Monthly expenses
- Income tax withholding
- The last 30 days’ amount
- Age of applicant
Statistics
- The loans usually can be rolled over for additional finance charges, and many borrowers—as high as 80% of them—end up as repeat customers.89 (investopedia.com)
- Upgrade The company offers a 3 percent cash back on Auto, Health, and Home categories and a 1 percent cash back on the rest. (abcactionnews.com)
- For example, CashUSA’s payday loan APRs range from 5.99% to 35.99%, placing them well within the averages for most major lines of credit, including credit cards and bank loans. (timesunion.com)
- Unlike other personal loans, payday loans often feature interest rates ranging from 391% to 600%. (timesunion.com)
- A typical two-week payday loan with a $15 per $100 fee equates to an annual percentage rate (APR) of almost 400 percent. (consumerfinance.gov)
External Links
consumer.ftc.gov
consumerfinance.gov
How To
The Best Online Payday Loans
These are short-term cash advances that can be accessed online at very low rates. These loans are available immediately and don’t require credit checks. They can also allow you up to $1500 to be borrowed in one day. It is generally paid back within 15 days after approval. It is necessary to have regular income and a checking or savings account. You can pay off your loan quicker by using many options. Before you apply for a loan, make sure to check the interest rates. Certain companies have lower interest rates than other. If you want to get approved quickly, apply early in the morning. They usually are available between 8 AM and 8.30 PM EST.
These services may be sought after for many reasons. You might need emergency funds in case you lose your job or have unexpected expenses. They might need funds to pay rent, or for car repairs. No-faxing loans are popular because they don’t require them to wait for paper documents to arrive. This type of service may be worth considering for people who are unable to pay bank fees.
These types of loans are relatively easy to obtain. Fill out the application form. You will need to provide basic information such as your name, address, and contact number. Once submitted, you’ll receive an instant decision and the amount of money you’ll be able to borrow. This usually takes less than 5 minutes. Once the process is complete, you will receive an email confirmation confirming how to repay the loan.
If you’re looking to borrow money for a longer period of time, you can choose between 2 different options. You have two options: an installment loan that requires monthly payments. An open-end loan is another option. Both require collateral. Collateral can be anything that someone else owns and is used to secure the loan. For example, if you own a home, then this would be considered collateral. In addition to the collateral, you must also sign a promissory note. This document includes the repayment schedule and details the amount that you’ll owe. This means you will borrow money for X month and pay the principal and interest.
It is a good idea to compare the APRs of different lenders when comparing them. Variable APRs can be charged by most lenders, ranging between 1% and 30%. The APR can vary depending upon factors like loan amount, duration and borrower’s credit score. Therefore, comparing loans with similar amounts and durations allows you to find the lowest APR.
To get the best deal, shop around. Shop both online and offline until finding the best lender suits your needs. Compare the benefits and features offered by each loan product to determine which one is the best. Make sure you ask for a printed copy of your contract. You should carefully read the contract before you sign anything.
Make sure you fully understand the terms of your loan agreement before you sign it. Understand the fine print and know precisely how much you’ll have to pay back. Also, ensure you don’t fall victim to scams and frauds. Ask family and friends for suggestions. Professional advice is recommended before you make a decision to apply for a loan.
