A payday loan is a quick financial fix offering small cash advances for a short period. It's designed to help people acquire fast funding to tide you over until your next paycheck arrives, hence the term payday loan. Payday loans are usually an unsecured form of lending, meaning that you don't necessarily need to collateralize anything such as your car or real estate to qualify for these loans.
How Much Can I Borrow with a Payday Loan in Utah?
According to the Consumer Financial Protection Bureau (CFPB), payday loans online can vary from $100 to $2500, depending on your state's rules. Currently, 32 states allow payday lending with a maximum loan amount cap. In the state of Texas, the maximum loan amount is not specified, but on average, it's $800 with a maximum loan term of 180 days. Remember, it's almost always worth examining your local jurisdiction before applying for a cash loan advance.
How Do Payday Loans Affect My Credit?
Actually, applying for a cash loan has no impact on your credit score since payday loan lenders seldom perform a traditional credit check. Also, after picking up a loan, it won't appear on your credit record; thus, it will be unable to assist you in improving your credit score.
However, if the loan goes overdue and the lender sells your account to a collection agency, it may show on your credit history. When a collection agency buys a delinquent account, it has the option of reporting it to the credit bureaus as a collection account, which might stay on your credit history for up to seven years and considerably lower your credit score.
How Do Payday Loans Work?
Payday loans are not the same as personal or other types of consumer loans available to take out from conventional lenders. Depending on the state of your residence, you can acquire a payday loan online or at a payday lender's storefront office.
Payday loan regulations vary by state, restricting how much you may borrow and how much the lender can charge in interest and fees. You can receive cash, a cheque, or have the money put into your bank account once you qualify for a payday loan online in Utah. The loan must then be repaid in full, including the financing charge, by the due date, which is usually within 14 days or by your next paycheck.
Payday loans are popular because they are quick and easy, plus payday lenders don't run a traditional credit check or require proof of financial means that you can pay back the loan.
Common Criteria to Qualify for a Payday Loan?
To qualify for a payday loan and have quick cash right away, you should meet certain requirements. You must:
Have a valid identification
Be at least 18 years of age
Have an open bank account (either checking or savings) in good standing
Have a steady source of income
Payday lenders don't usually pull a hard credit check to consider if a borrower can afford to pay back the loan. Payday loans are granted based on the borrower's ability to repay the loan rather than their credit history. As a result, these loans may seem an attractive alternative for those with bad or no credit but stable income.
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 Utah
|Annual Percentage Rate (APR)
|Minimum Loan Amount
|Maximum Loan Amount
|Minimum Loan Term
|Maximum Loan Term
|| 70 days
|Number of Rollovers Allowed
|| N/A (Extension can be up to 10 weeks or 70 days)
[ Updated on 14-Oct-2021, 23:09 ]