General Information on Payday Loans
What Is a Payday Loan?
A payday loan is a type of short-term loan that takes its name from the fact that it must be repaid within the borrower's next paycheck, i.e., usually a few weeks or a month.
Does Every State Accept Payday Loans?
The availability of each state in the US depends precisely on its specific regulations. For example, some states prohibit payday loans, others accept them, but with restrictions, some others instead allow them without particular reserve.
To check which category your state fits, please consult the payday lending state statuses offered by the National Conference of State Legislatures, which provides legal and up-to-date information on the topic.
When Should I Apply for a Payday Loan?
Payday loans, like any short-term loan, are useful and advised in case of emergencies. If, for whatever reason, you find yourself in urgent need of extra cash, payday loans can come in handy and bring great benefits.
However, you cannot borrow huge amounts of cash through payday loans, so you should apply to receive them only if the amount of money you require is relatively small.
Additionally, please keep in mind that short-term loans have high-interest rates. Therefore, using them to cover long-term needs may cause you more harm than benefit. Always check interest rates and fees with your creditor before signing the contract.
How Much Can I Borrow With Online Payday Loans?
The standard amount for a payday loan ranges from $100 to $500 approximately. Higher loans, for example, $1,000, can be granted only in a few states.
For higher amounts of money, you have to resort to other types of loans, such as installment loans, which allow for loans starting from $1,000.
How Are Interest Rates and Fees?
DirectLoanTransfer is a free service available to everyone in the US. The company does not charge any fees for its use. However, lenders do require payment of fees; there are several categories. Interest rates vary from state to state and ultimately depend on the lender. Usually, fees will have an APR (Annual Percentage Rate) of about 400%.
When signing an agreement with the lender, there are other fees you must consider. For example, originating fees, late payment and non-payment penalties, and more. But, again, all these depend on the specific lender, and the client has to check with them for the fee amount.
Payday Loan Application Process
What Are the Criteria to Qualify for a Payday Loan?
To qualify for any short-term loan, you must meet some specific criteria.
First, you must be at least 18 years old and a US citizen or resident.
Given that our lenders do not run a hard credit check on the borrowers, proof of stable income (at least $1,500 after tax monthly) is absolutely needed to prove to the lender you can afford to repay the loan later.
Both a phone number and an email address are required to verify the information you provide during the application and provide more safety to you and your transactions.
How Do I Apply for a Payday Loan?
To apply for a short-term loan, there are four main steps you need to follow. If done correctly and you meet all the criteria to receive a payday loan, the process is fast and easy: you can get approval in just a few hours.
- Visit our website and click on the "Apply" button.
- Fill out the loan application form with all the details requested. Please make sure all the info is correct and up to date. Make sure you have all the necessary documentation to speed up the process.
- Wait for the application to be approved by the lender in our network who matches your requests best. You can expect a call from the lender to verify your info and perhaps to ask for additional documents.
- Read the contract you and your lender stipulate and sign a digital agreement, binding you both before the law to the obligations written on the contract. After that, you can expect your money to arrive in your bank account as soon as the next business day.
Do I Need to Be Employed to Qualify for a Payday Loan?
Yes, employment is a fundamental requirement everyone applying for a payday loan must possess. In particular, the borrower must receive an average monthly income after tax of $1,500.
Otherwise, lenders do not have any kind of reassurance you will have the means to repay the loan as agreed. Remember that they do not run any kind of hard credit check on the client. Therefore employment status is one of the few elements to prove one's future ability to settle the debt.
Can I Apply for More Than One Loan at a Time?
The answer to this question depends primarily on the state you reside in. For example, some states in the US do not allow for more than one loan to be taken by the same client. In some others, it is instead perfectly legal to do so.
For more up-to-date information, you can check out the National Conference of State Legislatures on the topic of payday loans.
Whatever the law says, a piece of personal advice from top financial experts would be: to be careful in taking more than one loan, especially if you are not confident in your financial capacity and stability. Such a decision could backfire and completely ruin you, so don't take it lightly.
Can I Get a Payday Loan With Bad Credit?
Yes, credit history is not important when it comes to short-term loans, and at the same time applying for a payday loan won't affect your score. What matters to lenders is whether you will be able to pay the loan back.