What is a Payday Loan?

A payday loan - which could also be called a "cash advance" or "check loan" - is a short term loan, usually  500 dollars or less, which is generally due on your next payday.

Payday loans generally have three characteristics:

• The loans are for small amounts.
• Loans are generally due on your next payday.
• You must give lenders access to your checking account or you can also write a check for the whole balance in advance that the lender has a deposit option when the loan comes due.

Other loan options may vary. For example, payday loans are often structured to be paid in one lump sum payment, but the only interest payments - "renewal" or "rollovers" - are not uncommon. In some cases, payday loans can be structured in such a way that they could be repayable in small installments over a long period of time.

Here are some ways that lenders might give you the loan funds : 

• The provision of cash or a check, 
• Load funds on a prepaid debit card
• Deposit money electronically in your checking account.

The cost of borrowing (in charge of finance) can range from 10$ to 30$ for every 100$ borrowed. A payday loan of typical two weeks with fees of $ 15 per $ 100 is equivalent to an annual percentage rate (APR) of 400%. For comparison, ARPs on credit cards vary from 12% to 30%.

State laws and other factors influence a lot about how much you can borrow and you'll be charged. Some states do not have the payday loan storefronts because these loans are not authorized by state law, or because lenders may choose not to do business in a state rather than comply with regulations States.
There are special protections through Military Lending Act for active service members and their dependents who use payday loans and some other small dollar credit products.