Payday Loans FAQ
A payday loan (also called a paycheck advance or payday advance) is a small, short-term loan that is intended to cover a borrowerâ€™s expenses until his or her next payday. Typical loans are between $100 and $1500 and are due in two weeks,with interest.Â On a two-week loan, fees average $15 for each $100.Â The loans are also sometimes referred to as cash advances, though that term can also refer to cash provided against a prearranged line of credit such as a credit card.
In todayâ€™s volatile economy, more and more people are turning to payday loans for temporary financial assistance. This type of loan offers people guaranteed, instant cash based on what a person will receive on their next payday. A payday loan is basically money lent to a consumer that will be repaid once the borrower gets paid.
Often, payday loans have high interest rates, but they can be an excellent way to get money fast in an emergency. If your car breaks down, you have an unexpected medical bill, or you need some extra money for gas,Â payday loans can be a valuable resource. In most cases, a credit check is not necessary since your regular income will serve as your ability to repay the loan.
Frequently Asked Questions
What exactly is a payday loan?
A payday loan is a small unsecured loan, usually for $100 to $1,500, which is designed to meet your financial needs until your next payday. Essentially, you are making out a check for the advanced loan amount, plus a fee, to be held until your next payday. Payday loans are also known as cash advance, short term loans, payday advances, cash loans, fast cash, fast loans, bad credit loans, deferred deposit, and a number of other things. No matter what you call them, payday loans can get you through your financial crisis.
What are the requirements for a loan?
The minimum requirements for a payday loan are: You must be at least 18 years of age Have a job (or other regular source of income) You must have an active open bank account To be approved for a loan, you need to meet the requirements of the specific lender with whom you are connected. The lender will evaluate your application and determine whether you are eligible based on its own set of approval criteria. Factors such as income, direct deposit of your pay, past payday loan history and state of residence, may affect the approval of your loan.
If your application is accepted by a lender, your assigned lender may contact you directly and ask for additional information in order to approve the application. Payday lenders utilize proprietary criteria to evaluate applicants and will approve your loan when your application matches their criteria. In order to increase your chances of getting matched with a lender and ultimately approved for a loan, please be sure to fill out our application with honest verifiable information. For example, entering a cell phone number instead of a home phone makes it more difficult to verify your information and many lenders will not accept applications that cannot be verified. We do our best to find a lender for you, but unfortunately thereâ€™s no guarantee that your loan application will be accepted
How long do I have to pay back the loan?
Your loan is normally due on your next pay date. However, most lenders will allow you to extend your loan by paying a fee. Once matched with a lender, you will be directed to your lenders loan documents. Here you will find specific instructions as to what happens when your loan is due. You typically have the following options: Do nothing and your loan will auto-finance Pay off the loan in full Renew the loan and pay interest and fees only Renew the loan and pay interest and part of the principal Please contact your lender directly if you have repayment questions.
5 Ways to Compare Payday Loan Lenders
Choosing a payday loan lender properly requires you to consider more than just interest rates. To find the highest-quality lender possible, you will also need to evaluate the lenderâ€™s terms, policies, and other features. Ideally, borrowers should evaluate two or three different payday loan lenders before they begin the application process. A thorough comparison of different lending institutions will help make your borrowing experience more rewarding and much less expensive. To assist you with the lender comparison process, weâ€™ve put together a list of five ways you can compare your prospective payday loan lenders.
1.Â Finance charges/APR. Your first priority when choosing a payday loan lender should be the lenderâ€™s finance charges or APR (annual percentage rate). Payday lenders usually express their interest rates as finance charges, but comparing APRs is a more accurate way to size up the costs of a loan. To find the APR of the loan in question, either ask your lender or consult your loan documents. The APR should be disclosed in bold.
2.Â Maximum loan amount. All payday lenders have different caps on the maximum amount of money they will provide to any one borrower. The most common maximum payday loan amount is $500, but this can vary widely. Some lenders may offer loans of up to $1500 to qualified borrowers. If you need a larger payday loan, you might consider maximum loan amounts when shopping for a lender.
3.Â Repayment terms. Payday loan lenders also tend to have different policies on the repayment of their loans. While some lenders require borrowers to repay the loan on the original due date, other lenders may offer some flexibility with the repayment date. For instance, some payday lenders may allow you to use a roll-over on your loan, which means you pay a fee in exchange for more time to repay the funds. If repayment flexibility is important to you, look for lenders who have a variety of repayment options.
4.Â Convenience. You shouldnâ€™t have any trouble finding payday lenders that offer online application and approval processes. Handling the borrowing process online makes it infinitely faster and more convenient for you. Compare different lenders to evaluate the extent to which you can handle the borrowing process online. Ideally, your lender should offer an online application process and the electronic transfer of funds. If you donâ€™t want to fax in documents to qualify for your payday loan, you might also look for lenders that offer faxless payday loans.
5.Â Qualification standards. Certain payday loans are more difficult to qualify for than others, and this is primarily a function of how stringent the lenderâ€™s qualification criteria are. When you compare lenders, make sure you take the qualification requirements into consideration. You will have a much better chance of qualifying for the payday loan you need if the lender has simple, straightforward qualification standards.