May 18, 2015

7 Best Online Payday Loans for Bad Credit w/ Instant Approval

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If you have a cash emergency a few days away from your next paycheck, you can turn to online payday loans for quick funds. But how safe are applying for payday loans online when you have no or bad credit? This article will explore how payday loans work, their basic features as well as their benefits and shortcomings.

What is a Payday Loan?

A payday loan also is known as payday advance, payroll loan, salary loan, small-dollar loan, cash advance or check advance loans is a short-term unsecured loan offered for only a short period usually until the borrowers next paycheck.

You can easily access payday loans from the comfort of your home within just a few minutes if you have access to the internet. Online payday lenders offer borrowers instant cash when they have a financial emergency and the salary is still some few days to come. The loan is also provided to borrowers who don’t have sufficient funds to get them through the next paycheck, upon which the loan becomes due and needs a repayment.

You can access $50, $100, $500 or $1,000 payday loans with instant approval, and any other amount in-between.

The specific amount you qualify for will depend on the lender’s assessment of your capacity to repay, the maximum lending limits within your state, and other loan requirements (such requirements aren’t as stringent as installment loans).

Payday loans usually attract very high-interest rates, and it’s only a good option for you if you have an emergency since while they may offer you a quick fix, they do not provide a permanent solution for all your money needs. If you always find yourself in need of a fast loan, you need to examine your current financial situation for ways to change how you budget and plan your finances to see if you can free up any extra money.

Types of Payday Loans

Different types of payday loans exist, based on the type of borrower, the lender’s terms, and the purpose of the loan, among other aspects. Here are the main types of payday loans you’ll find.

1-Hour Payday Loan

With 1-hour payday loans, you’ll get a loan decision within an hour or instant approval. This is a fast and easy process which can help you in extremely urgent situations.

24-Hour Payday Loan

With 24-hour payday loans, you can expect the loan – if approved – to be deposited in your account within one business day. That’s different from typical payday loans that can take 2-4 business days before being deposited in your bank account.

Instant Cash Advance

With instant cash advances or instant payday loans, work on your loan starts as soon as you fill in the online application. Thereafter, the lender may contact you by phone, email, or both to complete the loan application process.

Payroll Advance

A payroll advance is a short-term unsecured loan allowing employers to release payroll funds to employees in advance.

Military Payday Loan

Military payday loans are specifically designed for people in military service. You can expect friendlier terms (including fees and interest rates) with such types of payday loans, since military personnel must abide by strict financial constraints. Based on the Uniform Code of Military Justice article 123a, military personnel who fail to meet their financial commitments can be transferred, confined, discharged, or even court marshalled.

How Do Online Payday Loans Work?

These loans usually have a very simple process of applying. They only require your details and after they are verified, you receive the cash either immediately or within some hours. Typically, some verification of employment or income sources is involved that is usually via pay stubs and bank statements although some payday lenders do not verify income or run any credit checks.

The payday lender usually explains the service they offer, as great option to clients who require some help or boost regularly. Payday lenders sometimes require post-dated checks to act as the loan’s security. Some payday advance loans rely on the borrower having previous payroll and employment records.

The online payday lenders make money by charging upfront loan fees and high interest with yearly rates that can go very high even as three to six hundred percent on the loans. Different states and jurisdictions are in the process of passing laws to prevent exploitation which is unreasonable and excessive rates of interest. Their aim is to introduce caps that will cushion the consumers from exploitation that usually come with the interest rates on the loans since many people depend on the loans to survive.

What are the Key Features?

Easy access and fast

The loan is tailored to help meet various urgent needs of a borrower, and thus it is a handy online instrument for managing short-term emergencies. It is a cash advance dependent on the expected regular paycheck.

A maximum amount of $1,000

The loan size may range from $50 to $1,000 and may be based on the borrower’s residence, income and credit rating. The loan amount varies from state to state, and the borrowers’ qualifications also depend on different payday lenders. While most states limit the maximum cash advance to $500 or $1,000, few are more permissive.

It’s costly

This type of loan is a costly borrowing method and is preferred mostly by individuals with poor credit or even no credit at all. These loans can be regarded as predatory forms of loans since they possess a reputation of charging exorbitant interest rates and concealed requirements of high additional fees.  In most cases the borrower ends up paying considerably huge amounts despite taking small loans, due to the high APR and associated fees.

Different states regulate the interest rate, but it typically varies from 200% to over 600%.

Payday loan interest rate for each state

The payday lender calculates the APR considering your income, loan amount and credit rating. A majority of states have usury restrictions that cap interest fees to approximately less than 35%. However, the payday lenders operate under certain exclusions that allow them to charge higher rates in some states.

Debit the money straight to borrower’s account

Online payday lenders make a direct debit into the borrowers’ account. The lenders then require the debtor to provide post-dated checks equaling the borrowed money or debit straight to the account. It grants the lender authority to deduct any money owed by the borrower plus fees, from their account directly.

It is payable once in total

On payday, the lender electronically withdraws the total loan amount plus the interest incurred for the period.

Roll over and renewal benefits

You may request for an extension or roll-over of the loan only in those states that the procedure is permitted. Although this action may get you trapped in a never-ending debt cycle

Payday Loans in each US State

This table shows the cities and states where you can get payday loans (based on the payday lending legality and number of rollovers allowed), as well as the interest rates you can expect.

StateCitiesPayday Lending LegalityNumber of Rollovers AllowedInterest RateMaximum Loan AmountMaximum Number of Outstanding Loans at One TimeRegulator
AlabamaBirmingham, Montgomery, Huntsville, Mobile, Tuscaloosa…Legal1456%$500None (max $ amount of loans at one time: $500)State Banking Department
AlaskaAnchorage, Fairbanks, Juneau, Sitka, Ketchikan…Legal2435%$500Not SpecifiedAlaska Division of Banking and Securities
ArizonaPhoenix, Tucson, Mesa, Chandler, Glendale…ProhibitedProhibitedN/AArizona Department of Financial Institutions
ArkansasLittle Rock, Fort Smith, Fayetteville, Springdale, Jonesboro…ProhibitedProhibitedN/AArkansas Attorney General
CaliforniaLos Angeles, San Diego, San Jose, San Francisco, Fresno, Sacramento…Legal0460%$255 if maximum fee charged ($300 maximum check)OneCalifornia Department of Corporations
ColoradoDenver, Colorado Springs, Aurora, Fort Collins, Lakewood…Legal1214%$500No limit if total debt does not exceed $500 and 30-days between loansColorado Office of the Attorney General
ConnecticutBridgeport, New Haven, Hartford, Stamford, Waterbury…ProhibitedProhibitedN/AConnecticut Department of Banking
DelawareWilmington, Dover, Newark, Middletown, Smyrna…Legal4521%$1,000Limit of five loans from all licensees in 12-month period.Delaware Office of the State Bank Commissioner
FloridaJacksonville, Miami, Tampa, Orlando, St. Petersburg, Tallahassee…Legal0304%$500OneFlorida Office of Financial Regulation
GeorgiaAtlanta, Augusta, Columbus, Macon, Savannah…ProhibitedProhibitedN/AGeorgia Office of the Commissioner of Insurance
HawaiiHonolulu1, Hilo1, Kailua1, Kapolei1, Kaneohe1…Legal (Applies to check cashers only)0460%$600 face amount of checkOneHawaii Department of Commerce and Consumer Affairs
IdahoBoise, Meridian, Nampa, Idaho Falls, Pocatello…Legal3652%$1000. Loan cannot exceed 25% of your gross monthly income.Not Specified ($1000 aggregate loans outstanding to all licensees)Idaho Department of Finance
IllinoisChicago, Aurora, Rockford, Joliet, Naperville, Springfield…Legal0404%lesser of $1000 or 25% gross monthly income.TwoIllinois Division of Financial Institutions
IndianaIndianapolis, Fort Wayne, Evansville, South Bend, Carmel…Legal0382%$550 (not to exceed 20% of borrower’s monthly gross income)One per lender; Two totalIndiana Department of Financial Institutions
IowaDes Moines, Cedar Rapids, Davenport, Sioux City, Iowa City…Legal0337%$500Two, $500 total debtIowa Division of Banking
KansasWichita, Overland Park, Kansas City, Olathe, Topeka…LegalNot specified391%$500Two. May not make more than three loans to a borrower within 30 daysOffice of the State Bank Commissioner
KentuckyLouisville, Lexington, Bowling Green, Owensboro, Covington, Frankfort…Legal (Applies to check cashers only)0460%$500Two ($500 aggregate loans outstanding to all licensees)Kentucky Office of Financial Institutions
LouisianaNew Orleans, Baton Rouge, Shreveport, Lafayette, Lake Charles…Legal0391%$350Not SpecifiedLouisiana Office of Financial Institutions
MainePortland, Lewiston, Bangor, South Portland, Auburn, Augusta…Permitted for supervised lenders onlyProhibited217%Bureau of Consumer Credit Protection
MarylandBaltimore, Frederick, Rockville, Gaithersburg, Bowie, Annapolis…ProhibitedProhibitedN/AMaryland Commissioner of Financial Regulation
MassachusettsBoston, Worcester, Springfield, Lowell, Cambridge…ProhibitedProhibitedN/AMassachusetts Division of Banks
MichiganDetroit, Grand Rapids, Warren, Sterling Heights, Ann Arbor, Lansing…Legal0369%$600Two, only one with same lender.Department of Insurance and Financial Services
MinnesotaMinneapolis, Saint Paul, Rochester, Bloomington, Duluth…Legal0200%$350Not SpecifiedMinnesota Department of Commerce
MississippiJackson, Gulfport, Southaven, Hattiesburg, Biloxi…Legal0521%$500 face value of checkNot Specified. Maximum $500 in one or more checks.Mississippi Department of Banking and Consumer Finance
MissouriKansas City, Saint Louis, Springfield, Columbia, Independence, Jefferson City…Legal6 (borrower must reduce principal amount of loan by 5% or more upon each renewal)443%$500No more than $500 to any one lender at one timeMissouri Division of Finance
MontanaBillings, Missoula, Great Falls, Bozeman, Butte, Helena…Legal (at a low cost)0N/A$300, up to 25% of monthly net income of borrowerDivision of Banking and Financial Institutions
NebraskaOmaha, Lincoln, Bellevue, Grand Island, Kearney…Legal0460%$500TwoNebraska Department of Banking & Finance
NevadaLas Vegas, Henderson, Reno, North Las Vegas, Sparks, Carson City…LegalNot Specified (Lenders cannot extend payment period beyond 60 days after expiration of initial loan period)652%25% of expected gross monthly incomeNot SpecifiedNevada Financial Institutions Division
New HampshireManchester, Nashua, Concord, Derry, Rochester…Legal (at a low cost)0N/A$500OneNew Hampshire State Banking Department
New JerseyNewark, Jersey City, Paterson, Elizabeth, Edison, Trenton…ProhibitedProhibitedN/ANew Jersey Department of Banking and Insurance
New MexicoAlbuquerque, Las Cruces, Rio Rancho, Santa Fe, Roswell…Legal0175%$2,500Total loans and fees capped at 25% of gross monthly incomeNew Mexico Financial Institutions Division
New YorkNew York City, Buffalo, Rochester, Yonkers, Syracuse, Albany…ProhibitedProhibitedN/ANew York State Banking Department
North CarolinaCharlotte, Raleigh, Greensboro, Durham, Winston-Salem…ProhibitedProhibitedN/ANorth Carolina Attorney General
North DakotaFargo, Bismarck, Grand Forks, Minot, West Fargo…Legal1487%$500Not Specified ($600 aggregate loans outstanding to all licensees)North Dakota Department of Financial Institutions
OhioColumbus, Cleveland, Cincinnati, Toledo, Akron…Legal (at a low cost)0677%$500One, four per yearOhio Division of Financial Institutions
OklahomaOklahoma City, Tulsa, Norman, Broken Arrow, Lawton…Legal0395%$500TwoOklahoma Department of Consumer Credit
OregonPortland, Salem, Eugene, Gresham, Hillsboro…Legal2154%$50,000 (Loan limit up to 25%of borrower’s net monthly income if earns $60,000 per year or less.)No LimitOregon Department of Consumer & Business Services
PennsylvaniaPhiladelphia, Pittsburgh, Allentown, Erie, Reading, Harrisburg…ProhibitedProhibitedN/APennsylvania Department of Banking
Rhode IslandProvidence, Warwick, Cranston, Pawtucket, East Providence…Legal1261%$500 face amount of check3/$500Rhode Island Department of Business Regulation
South CarolinaCharleston, Columbia, North Charleston, Mount Pleasant, Rock Hill…Legal0391%$550OneSouth Carolina State Board of Financial Institutions
South DakotaSioux Falls, Rapid City, Aberdeen, Brookings, Watertown, Pierre…Legal4N/A$500Not SpecifiedSouth Dakota Division of Banking
TennesseeNashville, Memphis, Knoxville, Chattanooga, Clarksville…Legal0460%$425 ($500 check)3 (2 per licensee) to maximum $500 face value of check/sTennessee Department of Financial Institutions
TexasHouston, San Antonio, Dallas, Austin, Fort Worth…Legal0662%Not specifiedTexas Office of Consumer Credit Commissioner
UtahSalt Lake City, West Valley City, Provo, West Jordan, Orem…Legal (Applies to check cashers only)Not Specified (cannot extend or renew loan more than 10 weeks from original loan date)658%No LimitNo LimitUtah Department of Financial Institutions
VermontBurlington, Essex, South Burlington, Colchester, Rutland, Montpelier…ProhibitedProhibitedN/AVermont Banking Division
VirginiaVirginia Beach, Norfolk, Chesapeake, Richmond, Newport News…Legal0601%$500OneVirginia Bureau of Financial Institutions
WashingtonSeattle, Spokane, Tacoma, Vancouver, Bellevue, Olympia…Legal (Lender must have a small loan endorsement to their check casher license to make payday loans)0391%$700 or 30% of gross monthly income, whichever is lesscheck(s) less than $700 aggregate face amount plus fees from one company. 8 loansin one year.Washington Department of Financial Institutions
West VirginiaCharleston, Huntington, Morgantown, Parkersburg, Wheeling…ProhibitedProhibitedN/AOffice of West Virginia Attorney General
WisconsinMilwaukee, Madison, Green Bay, Kenosha, Racine…Legal1574%Lesser of $1,500 including fees or 35% gross monthly incomeNo LimitWisconsin Department of Financial Institutions
WyomingCheyenne, Casper, Laramie, Gillette, Rock Springs…Legal0261%Not SpecifiedNot SpecifiedWyoming Division of Banking
Washington, DCLegal0

What Are Some Benefits And Dangers Associated With Online Payday Debts?

Advantages of when applying payday loans online

You get quick and instant access to funds.

Fast application process. Applicants spend less than 5 minutes in filling their details.

Online payday lenders give feedback on their decision within a few hours.

Someone does not require a great credit rating to acquire payday advance. You can still get the approval even with a bad or even poor credit history as long as you have a paycheck coming up.

You can’t delay in payment since you repay by your salary that goes into the account or any other amount that goes through the account.

Dangers that comes with these loans

If the account has a deficit on the repayment date, you may surpass the account’s overdraft perimeter or may even face the consequences of a bounced check.

If you opt for a rollover on your loan, you might end up paying fees even higher than the original amount.

The APRs may exceed the original loan considerably, and so it’s vital to go through all conditions and terms before you accept the offer.

If you default on payday loans, it could have an impact on your credit rating.

Payday loans charge high fees and interests and require quick repayment of the loan which often makes it difficult for a borrower to pay off the loan and still meet regular monthly expenses. So, you may quickly find yourself trapped in debts cycle that never ends since you mostly take another loan every time you repay the previous one for you to survive. It is crucial to creating budgets for your expenses to avoid that.

Payday Loan Alternatives

Check out some payday loan alternatives like: Personal Loans, Installment Loans, or P2P loans if you want to take advantage of having a lower interest rate and longer payment terms.

Bottom Line

An online payday loan is a convenient alternative if you have an urgent cash need, but you should never allow it to be your constant source of financial remedy because it is costly and can quickly exceed your ability to repay it.

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