Payday loans are short term loans to help you pay for emergency expenses until your next pay day. Payday lenders will ask for a post dated check or authorization to withdraw from your bank account. Many payday lenders are online and brick and mortar. Payday lending involves minimal credit checks so it’s open to those with bad credit. You’ll need to provide pay stubs, social security numbers and income info to sign a payday loan agreement. The loan is then deposited into your bank account or loaded onto a prepaid debit card.

Features

• Short Term. Payday loans are short term loans, due in 2-4 weeks.

• Loan Amount. Small dollar loans, $100 to $1,000.

• Repayment. Repayment is one lump sum on your next pay day.

• Interest Rates. High interest rates and fees, much higher than a credit union or bank personal loan.

Pros and cons

Pros

1. Fast Access to Funds. Payday loans get you money fast, often same business day.

2. Minimal Requirements. Just need a pay stub, social security number and proof of income, no credit check required.

3. Accessibility. Online lenders make it easy to apply from anywhere.

Cons

1. High Interest Rates And Fees. Payday loans have extremely high interest rates compared to personal loans and other payday loan options.

2. Single Payment Repayment. You have to repay the loan in one lump sum by the due date, which can be tough.

3. Financial Protection Risk. If you don’t repay the loan on time you’ll have additional financial obligations and harm your financial protection.

How to Apply for a Payday Loan?

1. Choose A Payday Lender. Select a reputable payday lender, online or brick and mortar, that follows state and federal laws.

2. Prepare Required Documents. Gather pay stub, social security number, bank account info and proof of income.

3. Complete The Application. Fill out the payday loan application with personal info, employment info and loan amount. Submit online or in person.

4. Review The Payday Loan Agreement. Review the payday loan agreement carefully, interest rates, fees, repayment terms and due date.

5. Receive Loan Proceeds. Once approved, loan proceeds will be deposited into your bank account or prepaid card account, same business day.

Requirements

According to the U.S. government’s Consumer Financial Protection Bureau (CFPB), most payday lenders require:

1. Be 18 or older. You must be a legal adult to sign a payday loan agreement.

2. Have an active checking account. A valid and active bank account to deposit loan proceeds and for the lender to withdraw repayments.

3. Proof of income. You need to show proof of regular income, pay stubs, to show you can repay the loan.

4. Valid ID. You must present valid ID, social security number, to verify your identity.

How to Get the Money

1. Direct Deposit. Most common is a direct deposit into your bank account. Once approved, the payday lender will deposit the loan proceeds into your active checking account, same business day.

2. Prepaid Debit Card. Some payday lenders offer to load the borrowed amount onto a prepaid card account. Good for those who don’t want to use their bank account.

3. Cash. In some cases, especially with in-person lenders, you can get the borrowed amount in cash. But this is less common than direct deposit or prepaid card.

4. Check. A few payday lenders will give you a check for the loan amount, you can then cash or deposit into your bank account.

Payday Loan Rates

Payday loan rates are a fee that ranges from $10 to $30 per $100 borrowed, depending on state laws and max borrowing limits. A common fee is $15 per $100 borrowed which is an APR of nearly 400% for a 2 week loan. For example, borrowing $300 would require you to repay $345 if the fee is $15 per $100 borrowed by the next payday. These rates show how expensive payday loans are compared to other types of loans.

Payday Loans. Apply Online

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