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Payday Loans in New York

Currently, the payday lending industry is one of the fastest-growing in the United States. Every year, new large companies offering online cash advances emerge. There have been several favorable and bad reviews and articles written regarding cash loans. Despite their contentious nature, such credit instruments are becoming increasingly popular. 
However, there are still states where payday lending is prohibited, such as New York or North Carolina. 

What are Payday Loans? 

Payday loans are small-dollar loans usually due in two to four weeks. In simple terms, these are a short-term fix to help you make it until your next payday. To take out a payday loan, you may need to write a postdated check made out to the lender for the full amount, plus any fees. Or you may authorize the lender to debit your checking account electronically. 

Alternatives to Payday Loans in New York 

If you have been struggling financially, you might be tempted to walk into one of the payday loans offices or check out online alternatives that you have probably seen out and about. So payday loans are often high interest, short-term, no collateral loans. So you don’t have to put up anything to get the cash. However, in the state of New York, payday loans are not allowed; thus, we will talk over some handy alternatives you may consider as a quick solution. 

Personal Loans

The first option is to take out a personal loan. It often comes with lower interest and has more flexibility on repayment. However, it may be challenging to get a personal loan when you have bad or no credit. Keep in mind, the lower your credit score, the higher risk of not being repaired your lender holds. 

Borrow from Your 401k

Alternatively, you can look at the borrowing from your 401k. You can pick up as much as fifty percent of your savings, depending on the employer's plan. If you cannot pay the money back by the due date, you could incur more fees and taxes on that money. The interest that you pay back on a 401k loan goes to you, not the lender. All things together, tapping into your savings account may not be the best idea as you may end up having nothing to put toward your retirement years. 
Title Loan

A title loan is a collateralized (secured) type of credit where you put up your vehicle as collateral. These loans might seem a good option to obtain extra money; however, you bear the risk of losing your car over a hundred bucks. Collateral always helps you qualify for a loan, but it could be seized if you default on your contractual obligations.


Going to a pawnshop to put up a valuable item for collateral in exchange for a loan can be really risky. If you don’t end up paying your loan back on time, the pawnshop gets to keep whatever item it was that you put up.


As a result of changes CFPB has made, from July 2020 the lenders don't have to check if the borrower is able to repay the loan. Thus, we encourage you to be careful and make sure you can afford the loan before applying.

Regulations of Payday Loans in New York
Status     Prohibited
Annual Percentage Rate (APR)     N/A
Minimum Loan Amount     N/A
Maximum Loan Amount     N/A
Minimum Loan Term     N/A
Maximum Loan Term     N/A
Number of Rollovers Allowed     N/A
Finance Charges     N/A
Cooling-off Period     N/A

Useful Sources

Real interest rate map /PDF/ of payday loans in the United States calculated on a typical loan.

Payday loans regulation /PDF/ by state 2020.

N.Y. Banking Law 340 et seq. outlines lending rules in the state.
The Consumer Financial Protection Bureau (CFPB) makes the financial marketplace work more effectively and educates consumers to help them take more control over their financial lives. Click here to learn more.
More information about payday loan laws and regulations in New York can be found on the official website of the New York Department of Financial Services.

[ Updated on 22-Aug-2021, 21:12 ]

We've been in the industry for more than six years.