Online payday loans are legit and legal. Many state governments allow lenders to provide loans on the internet. This is better than approaching unlicensed loan sharks where your consumer rights may not be protected. There are many finance companies based in United States that specialize in payday loans for people with bad credit.
That said, payday loans are not allowed in Connecticut, Maryland, Massachusetts, Pennsylvania, Vermont, and West Virginia. Residents in the above states are not supposed to use such loans.
Are Payday Loans Safe?
Yes, provided you borrow from established lenders and not fake loan websites. When you need money quickly, the last thing you want is getting tangled in loan frauds. Always choose a legitimate loan company, we will teach you how to do so below.
Many people are worried about the safety of borrowing online payday loans. To start, you need to submit your personal information and copies of documents over the internet. You may be concerned how the loan website handles your data, is it kept secure and will your information be leaked.
The loan website or lenders must adhere to rules and regulations regarding loans and personal privacy.
How To Compare Payday Loan Lenders
|Website security||All reputable loan websites are using Secure Sockets Layer (SSL) to provide end to end protection of information between the web server and your web browser. This ensure that personal information is encrypted and cannot be viewed by third parties. Just look out for the lock icon in the address bar before you fill the sign up form with your info.|
|Maximum loan amount||Every state has its own limits on how much you can borrow from payday loans.|
|Minimum credit required||Payday loans are usually income based loans, so having a stable job is a more important criteria compared to having the best credit scores. Even when you have bad credit or no credit, you may still a loan approved subject to other conditions.|
|Rollovers||In some states, rollovers are not even allowed. You have to pay back within the deadline as scheduled.|
|Funds transfer||The borrowed funds can usually reach your bank account as quickly as the next business day. Clarify with with your lender if this is very important for you.|
|Accredited lenders||Simply check if your lender is accredited by Best Business Bureau (BBB) or belongs to some lender associations such as Community Financial Services Association of America (CFSA). These mean they are more likely to abide by best practices in the lending industry and it is easier to check whether there are complaints against the lender. Or check out whether the lender is licensed by contacting your state’s Department of Financial Services (DFS).|
|Testimonials||There are many complaints about payday loans, so do a Google search for reviews and testimonials from a lender’s past clients. You should be able to find a few discussions on forums concerning the lender. This is an important step to verify the legitimacy of your lender, so do not skip it.|
How To Qualify For Payday Loans
- above 18 years old
- have a stable income
- active checking account
- not in the military
How Much Does A Payday Loan Cost
You should refer to the actual loan offer for the fees. Generally, payday loans are charged an APR which can exceed 400%, depending on where you live and your lender’s policies.
Note that late and missed payments will mean additional fees which can quickly double what you owe. Payday loans are extremely dangerous in the hands of immature and irresponsible borrowers. They can cause a lot of damage to your future if you are not careful.
Can You Get 2 Payday Loans At The Same Time
Very unlikely. In some states, there are laws explicitly prohibiting you from getting a second payday loan until the first one is fully paid off. Compliant lenders will not be able to lend you another loan meanwhile. Therefore, carefully calculate how much you truly need in case you run out of money again.
Payday loans have tight deadlines, usually set to your next payday. Do not try to postpone paying, the interest fees are very high and the amount you owe will keep increasing. If you cannot afford the payments, stop immediately and do not proceed to sign the loan contract. Look for other ways to get the money.
While searching for a payday loan, it is wise to make sure the lender can be trusted and will not steal your personal information or commit fraud. Keep your eyes open and generally borrowing an online loan is a safe and hassle free experience.
Always pay back loans first, before spending your money on other items. The benefits include building good relations with your lender for bigger loans in future, and improving your credit so that you become eligible at better loan places in the future.