Payday Loans Online: Learn How To Apply Fast and Secure
As is often the case, financial emergencies happen when we least expect them. Your car may break down suddenly, or you have some outstanding bills that you need to pay before your next paycheck. If you don't have the extra cash, these kinds of situations may require you to seek financial assistance from friends, family, or even the bank.
If you ever find yourself in a situation where you can't get the financial help you need, personal loans may be useful. Payday loans can be the solution to those monetary woes. However, before you take a step towards getting any loan, you need to know there is useful information. Details on how to apply for a payday loan, the requirements needed, and circumstances, and how to avoid spiraling into a web of financial ruin.
What is a Payday Loan?
A payday loan is a short-term loan that advances cash to borrowers with a payback date that usually coincides with the borrower's next payday. They are also known as cash advance, post-dated check loans, or deferred deposit loans.
These loans don't necessarily require good credit scores, and for this reason, they attract very high rates. The high interest rates that payday lenders charge reflect the high risk involved in giving loans to borrowers without requiring a good credit score or collateral.
Different legislations in the United States (US) dictate how these loan applications, requirements, and interest rates work. These vary by state, so it's vital to check the laws in your area. Payday lending is not allowed in certain States, and some States restrict certain practices related to them.
How Do Payday Loans Work?
Usually, payday loans are short-term in nature and are usually due within your next pay period cycle. This means that lenders expect you to pay it back in as little as 45 to 65 days when you take a payday loan. Payday lenders have to inform you of when your payday loan is due.
Different lenders offer various amounts for these types of loans, ranging from small loans $100 to as high as $1,000. Lenders outside of the Payday market offer higher loan amounts, up to $5,000 in some cases. These products typically offer a longer repayment period.
These lenders usually provide a borrower with cash, either in-person or depositing directly into their bank account. In turn, they request a post-dated check for the loan amount plus a fee or interest on the loan. This check would usually be payable to the lender on the borrower's next payday. Sometimes, your account can be automatically debited with the principal and the interest charges.
Lenders can offer borrowers rollovers or extensions if they can't repay the principal on time. Usually, the fee continues to accumulate on the loan amount until it's paid in full. Lenders have to disclose all the loan details, including terms, related fees, and costs. You would also be aware of the loan's Annual Percentage Rate (APR) before signing any contract.
Some key things to note about payday loans include:
- Payday loans aren't available in all states, and payday loans' requirements may vary across different States.
- Payday loans are not necessarily no credit check loans; some lenders would check your credit scores before they approve your loan application.
- There are certain requirements to be met before your loan application can be approved.
- These loans have higher-than-average interest rates; they are widely known to be very expensive.
- There are no requirements for collaterals or deposits for you to get access to them.
Most lenders provide multiple loan application options; you can apply to receive a cash advance online or in-person. Loan providers don't usually request collateral or other traditional requirements to approve a payday loan. Applying for online payday loans is simple, fast, and safe. The application process is usually straightforward and doesn't require cumbersome paperwork.
You may be asked to provide information such as:
- Your personal details- Name, address, and phone number
- A valid government ID
- A bank account
- Your social security number
- Proof of recurring income
A payday loan application's requirements may change for each loan provider and each state, so it's important to check what documentation and information each lender requires before you apply, as well as your State's regulations.
Generally, to qualify for a payday loan, you would need to:
- Be at least 18 years old.
- Have a steady income
- Reside in the state of your loan application.
Also, most, if not all, lenders require that you can't be in a current or expected bankruptcy situation.
Because of the nature of payday loans, easy applications, and no collateral involved, lenders' amounts are usually not too high. Most lenders understand that financial needs vary and can provide cash advance for low amounts such as $50, $200, and $300. You would also be able to get as much as $1,000 or $1,500 from various loan providers.
Payday loans may offer you a cash advance, but they come at a cost. As it is with other alternative loan types, payday loans attract relatively high fees and interest rates. Payday lenders charge a percentage on loan amounts borrowed; most times, this would be an amount per $100.
Payday loans are costly, usually costing as much as $15 per $100 and sometimes even up to $30 per dollar. This could mean an annual percentage interest rate of 400% or more for a single payday loan.
The costs associated with a payday loan may vary across states. Interest rates offered by different lenders also differ.
A payday loan is expected to meet short term emergency cash needs. These short term loans are generally costly and come with high fees in the case of repayment default. It is recommended to explore other less expensive loan options, if available.
If you have no other financial leverage to offset unexpected expenses such as car repairs or bills when they fall due, you can consider taking a payday loan. However, these loans should be only be explored. It can be repaid with its interest when due; this is necessary to avoid getting caught up in a situation that requires the loan being continuously rolled over and raking in more fees.
The high cost of payday loans is a major reason people consider them to be a bad option.
You are generally expected to repay a payday loan by your next paycheck. While payday loans may seem easy and quick to obtain, you want to make sure they are paid when due. If you can not repay a payday loan, it could result in higher fees. For instance, when you do not pay back the loan, the lender may use a debt collector's third party services. Debt collectors are known to be aggressive and would hound you incessantly until you repay the loan.
Sometimes, not paying back a payday loan can lead to legal measures and can also hurt your credit score.
While many payday loan providers promise instant approval for payday loan applications, you need to realize that this depends on meeting the lenders' requirements. When you have provided the required information or documentation for a payday loan application, this would be assessed and approved based on satisfactory details.
You can get access to cash on the same day or as fast as in one business day. For this reason, payday loans are usually referred to as same day loans.
If you are concerned that a payday lender would not approve your loan application due to bad credit, you may need to worry less. While a payday lender may check your credit score as part of the application process, they can still afford you a loan even if you have poor credit.
Payday loans are known to provide an alternative option for quick cash to individuals who have bad credit and can't seem to get loans elsewhere.
Some lenders allow you to roll over your loan if you cannot pay it back when the loan is due. Loan providers expect you to pay the loan balance's annual percentage rate, leading to more loan-related costs.
Some states prohibit payday loan renewals or rollovers, so check with your loan provider and State regulations to see if this is applicable.
Having a job is not necessarily a requirement for most loan providers. What payday lenders require is a steady income source either from a regular job or a pension, self-employment, or welfare payments. As long as you have proof of constant income that enables you to pay back a loan, a loan provider may be willing to provide you with a fast cash advance. A Payday loan can provide financial relief for eligible unemployed individuals.
Some lenders may provide short-term loans to active military members and their family members, while others do not. If you are a service member, you need to determine if the loan provider allows applications from those in the military.
It is important to note that certain protections prevent payday lenders from charging high fees and interests to military members and their families under Federal law and a Department of Defense rule. The Military Lending Act (MLA) protects service members from certain practices that waive their consumer protection rights.
Due to the MLA's 36% interest rate cap for short-term loan annual percentage rates, most payday loan providers exclude military personnel and their families from payday loan applications.
If you do not find a lender willing to provide cash advance to you as a military member, you can consider other government and military loans or relief programs such as the Air Force Aid Society, Army Emergency Relief, Coast Guard Mutual Assistance, or the Navy and Marine Corps Relief Society.
If you do not want to draw up a short term payday loan due to the costs or other reasons, you can consider borrowing from family and friends. You can also explore drawing up from your credit card or using an overdraft option from the bank.
Other quick cash options include title loans or installment loans. Note that these options may provide higher cash amounts for a longer period of time but are also expensive. Title loans usually require using your vehicle as collateral.
A key aspect of borrowing money involves searching for cheaper and more available options, especially when faced with a financial emergency. Some alternative options may be available but not promptly. They may not provide instant cash for emergency needs.
Payday loans are recommended for short term solutions to financial stress, for moments when you urgently need to repair a household item, fund bills, or even get groceries. However, it is advisable always to pay back these types of short-term loans when due. Payday loans are already an expensive means of borrowing, and defaulting on repayment may lead to even more costly implications.
Use payday loans only to the extent to which you can comfortably make repayments. If you have debt issues, you may need to consider credit counseling or debt consolidation professionals' assistance.
Disclosure: We do not provide loans directly, but we connect you with quick access to top payday loans and similar short-term loan providers.