Most Trusted Payday Loans Online

Payday loans are short-term, small-dollar loans that borrowers can take out against their next paycheck. Loan amounts can vary from $100 to $1000 and loan terms are typically two to four weeks, at which point a borrower has to repay their full loan amounts, plus interest.

While short-term loans can be viable resources for those in a financial bind, borrowers should be wary of predatory lenders who may advertise with phrases such as “guaranteed payday loans online”, “online payday loans for bad credit”, or “instant approval payday loans”. Such notices are false as lenders will, in fact, check an applicant’s creditworthiness before loan approval. Similarly, there are no guaranteed online payday loans and funds are typically not dispensed instantly. Borrowers will have to wait for one to two business days before receiving their loan amounts.

Secure online payday loans

Borrowers should note that the most trusted payday loans online and the most legitimate payday loans are from lenders that adhere to the appropriate short-term lending state rules and regulations.

Lenders and brokers that offer safe and secure online payday loans typically have streamlined request processes that keep applicants’ data and information safe with secure technology.

How do Payday Loans Work?

Many Americans turn to payday loans in times of financial insecurity. In fact, each year, a reported 12 million borrowers to spend more than $7 billion on payday loans. Payday loans can not only help residents cover emergency financial needs, but can also help to mitigate monthly costs. Short-term cash advances can be used for:

  • Medical expenses, including insurance co-pays and money for prescription drugs and over-the-counter medications
  • Vacation expenses
  • Home improvements
  • Personal expenses
  • Business opportunities
  • Child-related expenses
  • Educational costs
  • Living expenses between paychecks

Potential borrowers can apply for a payday loan online. Most application processes can take around 15 to 60 minutes to complete. While payday loan requirements will vary from lender to lender, borrowers will typically have to present the following:

  • Federal or state identification with current address
  • Employer information
  • Bank account information
  • Social security number

Consumers who have poor credit or have non-conventional forms of income can still apply for a payday loan to see if they are approved. Alternate forms of income may include child support wages, royalties, self-employment income, or social security benefits.

Rules and Regulations

Potential borrowers should note that short-term loans are typically regulated by the state, meaning that each state can set its own guidelines and loan limitations. While about 31 states permit payday lending, sixteen states, plus the District of Columbia, prohibit high-cost payday lending. States such as Georgia, New York, and New Jersey have loan rate caps that make it difficult for lenders to operate within those states.

Maine, Oregon, and New Mexico permit lower-cost payday lending, meaning that there are caps on the amount a borrower can take out.

Additionally, lenders are often required to have appropriate licenses before operating in a legal payday state. Borrowers should be aware of the rules and regulations associated with payday lending in their state before opting for one. Consumers who find themselves in illegal or predatory lending situations can report such instances to their local state department or attorney general.

Alternative Options to Payday Loans

Short term loans often carry high APRs and steep rollover fees. In some cases, APRs can be as high as 300% and borrowers may need to take out additional loans to cover prior ones. This can easily trap borrowers into deeper cycles of debt. Financial advisors recommend that borrowers only take out loans if they are able to manage them and meet full terms and conditions.

Individuals who want alternate options to payday loans can consider the following:

  • Borrowing from trusted friends and family: While this option prevents borrowers from operating within financial institutions, consumers should borrow with caution as there are no formal or legal documents binding the two parties in the agreement.
  • Paycheck advances: Individuals can ask their employer or place of work to process their paychecks early, in order to mitigate monthly bills that might be due before payday.
  • Personal loans: Borrowers can take out personal loans, which typically have longer repayment periods and lower APRs and fees.
  • Cutting discretionary spending: Consumers can save up money and avoid unnecessary spending in order to stay away from high-cost payday lending.