Four Things To Consider When Applying For A Payday Loan

Posted on: 3 September 2015

Even if you have a steady job that pays a decent salary and little to no debt, you can still be vulnerable to financial uncertainty. Events like emergency home repairs and unexpected medical bills may cause you to deplete your checking account and savings in order to make ends meet. If you find yourself in a tight financial situation and need funds to tide you over until your next paycheck, a payday loan may be your best option for getting out of short-term debt. However, before you fill out an application, make sure to consider the following factors.


You will not have to worry about being denied for a loan due to poor credit when you apply for a payday loan. The eligibility requirements are primarily based on your job stability and the amount of your regular paycheck. You must be an adult with a valid checking account and a minimum amount of monthly income.

Be aware that if you are a member of the military, you cannot apply for a payday or a car title loan. As of 2007, federal law prohibits creditors from offering these types of loans for soldiers. The military offers its own debt counseling services and options for loans for active duty personnel.

So before you spend time traveling to a payday loan office or filling out an online application, check to make sure you meet the eligibility requirements.

Repayment Planning

Even before you apply for a payday loan, you need to begin planning how you are going to pay the money back.

  • Make sure you do not borrow more than you can pay back in order to avoid late fees or having your loan account sent to a collection agency.
  • If you are able to borrow money from family or friends to pay your loan back early, do it. This will give you peace of mind from worrying about paying the loan back on time.
  • Take into account any automatic deposits for bills or other expenses that may impact how much money you have in your bank account on the day that your loan is due. Many payday lenders will deduct the loan amount straight from your bank account.
  • Put yourself on a bare-bones budget until you repay your loan. Cut out any extraneous expenses and entertainment costs to help you save in the short term.
  • If your job offers overtime, pick up some extra shifts to help you cover the cost of the loan.
  • Make sure you understand the late fee structure of the payday loan company. In addition, find out if the firm offers loan extensions in case you cannot pay back what you borrowed on time.

State Rules

Each state has different laws regarding payday loans. The National Conference of State Legislatures provides a table that outlines the basic loan terms for every state. Fees, loan caps and eligibility requirements will vary depending on where you live.

Most states allow lenders to provide up to $500. However, in California you can only borrow $300. Yet Oregon has a generous cap of $50,000.

So if you ever applied for a payday loan when you lived in another state, do not be surprised if you are unable to borrow as much from a lender where you currently reside.

Debt Counseling

Do yourself a favor and sign up for a debt counseling course if you find yourself in dire straits financially. Many community education organizations offer low-cost or free personal finance and debt management classes.

In addition, the U.S. Department of Justice provides an online database of government-approved credit counseling and debtor education providers in every state.


preparing for your financial retirement needs

If you were forced into retirement in the next five years, would you have enough money put away to support yourself? Many people don't have nearly enough money put away for retirement and won't have enough put away even ten years from now. So, what can you do to better prepare yourself for retirement? This blog will give you some great advice about how to prepare for the financial needs of retirement. You will learn how to grow a portfolio quickly without breaking the bank today. Hopefully, everything that I have learned over the years will help you begin preparing for your retirement in the future.

Latest Posts