A payday loan – sometimes referred to as a cash advance loan, payday advance, deferred deposit loan, check advance loan or postdated check loan – are short term financial loans.
These loans are used to secure emergency funds, or fast cash, in order to help cover immediate needs for items such as rent, utilities, food or medical bills. They are one way to bridge the gap between paychecks and help with unexpected expenses.
How much can I borrow?
Different states have varying laws surrounding payday loans, limiting how much you can borrow or how much the lender can charge in interest and fees. Some states prohibit expert payday loans altogether and others have established legal maximums. Borrowed amounts range from $100 to $1,000, however loans can be for smaller or larger amounts.
Where do I get a loan?
There are several storefronts, markets and pawn shops that offer these loans. A person can simply walk into once of these stores with the required documentation to secure a loan. Loans are also available from online lenders.
How old do I need to be in order to get a loan?
Loans require that a person be at least 18 years old to secure a cash advance.
Do I need property to secure the loan?
No, the lender secures the loan based on your job and paycheck information, you don’t need additional collateral.
What are the requirements of getting a loan?
There are limited requirements for obtaining a loan. Requirements can vary be lender and state, but in general you will be required to have a government issued ID or Social Security number, you must be at least 18 years of age, have a regular job or other regular source of income, and you will need an active bank account.
How long are payday loans?
A person is generally required to repay a these loan with a single payment by their next payday or before. Most payday lenders will ask the person loaning the money to write a postdated check corresponding with their next payday; the average loan term is about two weeks.
What fees do I need to pay?
Keep in mind these loans come with finance charges, which are typically based on the loan amount. Additional fees could be charged including: non-sufficient funds charge, if you don’t have enough money available in your bank account when lenders try to cash your check or electronically withdraw from your account; late fees, if you don’t repay the loan on time; and rollover fees, if you need additional time to pay and add additional time to the loan payback. State laws can impact fees and number of times a person can rollover a loan.
Will this impact my credit score?
Applying for a these loans is not likely to impact your credit score, since most storefront lenders won’t run a credit check. While paying the loan back on-time won’t have a positive impact on your score, defaulting on the loan can negatively impact your credit.