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A payday loan is a great option if you are looking for a quick way to borrow money online in a financial emergency. If for example, you are facing an unexpected bill such as car repairs, a medical bill or a veterinary bill that you did not think would happen this month, then a payday loan could mean you get the money you need to pay off your debt, repaying the loan at your next payday. Before signing or applying for a payday loan you should always look around and see what other options are available. Common short term loans to consider may include:

Whether you choose a payday loan or otherwise, using these loans correctly may allow you to cover those unexpected costs, that hit you when you least expect it, giving you the money you need when you need it fast. You should however, always look at other options and that should include considering longer term alternatives to payday loans such as long term loans, title loans and more.

However, there are some things that you should consider before you begin submitting your application for a payday loan anywhere, whether online or in a payday store on the high street and that is why Kallyss are here to help you and why we have created this handy guide of 10 things you should consider before you submit your payday loan application.

1. Am I Eligible for Payday Loans in the USA?

The first thing to consider before taking out a payday loan is if you will be able to get one in the first place. If you apply for any loan or form of credit, there may be a ‘footprint’ or record of the search left on your credit file. This is not necessarily bad, but if you have many searches close together it may suggest that you are struggling to secure credit or any loans, which can be a red flag to other lenders.

Many credit searches can suggest to lenders that you are being rejected by other lenders which could mean you are a greater risk to them. This can harm your chances of securing the money you need and you should therefore be careful before considering any application for any loan. It is important you make sure that you are even eligible for a payday loan before you start your application process. To be eligible for a payday loan in the USA you must:

  • Be a U.S. resident (residing in a state that allows payday loans such as California, Texas, Iowa, Kentucky etc.) 
  • Be over the age of 18
  • Be in steady employment with a stable income
  • Earn a minimum of $800 per month ($9,600 per year)
  • Possess a valid mobile phone account and number
  • Possess a checking account for the loan to be deposited (if approved)
  • Be able to afford the loan repayments

If you do not adhere to these eligibility criteria, do not apply for payday loans online or elsewhere, as it might harm your credit score making it less likely that you are approved for other loans in the future.

2. How Much Money Do I Need to Borrow?

Think about how much it actually is that you need to borrow. Asking for less or more than you need may end up causing you more harm and stress then is needed. If you borrow too much then you may end up having to payback to the lender much more than you anticipated, as the APR for short term loans like payday loans is extremely high and you should only borrow what you need so it is easier to repay.

However, if you borrow too little then you might be forced to take out another loan in quick succession and end up struggling for repayments as some loans even have a minimum borrow amount. This could end up harming your credit rating in the future making it harder to receive other loans or financial deals. You should never borrow money for anything that is not an emergency or essential and you should only borrow what you absolutely need. If you can avoid applying for a payday or other short term loan, you should always seek alternatives.

3. Have You Taken Out a Loan Before?

If you have taken out a loan recently then it may be harder to be approved for a payday loan.

Lenders do not appreciate that people often need to take out multiple loans to cover costs and expenses as they pile up. When it comes to lenders, people who have taken out many loans in quick succession may raise alarm bells, as it looks as if they are getting new loans in order to pay off old ones. Although debt consolidation can be a good thing and can be positive for your credit rating and finances, it is not always the case that payday loans are the best way to achieve the consolidation you may need.

This might mean you are less likely to be accepted for your payday loan application; if you have not taken out a loan before then make sure you understand the rules and terms and conditions of your loan agreement with the lender and make sure you repay on time, so you don’t end up defaulting or ending up in court with unpaid bills.

4. Can I Afford the Loan Repayments?

This might be one of the most important things to consider before submitting your payday loan application.

Make sure that before you apply you totally understand that you are able and willing to repay the loan in full, to the agreed lender on the terms agreed. Not repaying your payday loan on time can have severe consequences that include incurring extra charges, follow up calls and emails and even being sent to court in more extreme cases. Making sure that you have the means to afford repayments is vital before submitting your application. If you cannot afford to repay a loan you should never apply for it.

5. Have I Considered The Alternatives?

Considering alternatives to payday loans is a good thing to do, especially if you believe you might struggle with repayments. There are various different options for alternatives to payday loans.

These include borrowing from family and friends and maybe even looking at getting a longer term loan so that you can repay more manageable and smaller amounts over a longer period of time. Look at the alternative options for you before submitting your application so that you know you are making the best decision for your financial situation and circumstances.

6. How Long Will I Need to Repay The Loan?

It is important to consider how long you will need in order to fully repay the payday loan you are looking to take out. If you do not think that you will be able to repay on your next payday then that is ok but you should make sure to communicate that with your lender as soon as possible. This way you can sort something out with the lender so that you can repay smaller amounts of a longer period of time or look elsewhere for a payday loan so that you do not default on your repayments.

Remember you can always repay earlier than planned if you find yourself having the money to repay, so give yourself the most amount of time possible to repay your loan so you do not run into any of the consequences.

7. What Are The Implications of Not Repaying a Payday Loan?

The implications of not repaying your payday loan can be severe. There are a few things that will likely occur if you do not make the repayments on your payday loan. These include:

  • Incurring late fees and penalties
  • A severe impact on your credit rating
  • Follow up emails, calls and letter from your lender to you and sometimes even your place of work
  • Much higher interest rates on loans in the future
  • Harder to be approved for loans in the future as well because of a poor financial history of repaying loans

In the most extreme cases, if you do not show up to court when asked to, you might even face jail time.

8. Have I Provided the Necessary Information to The Lender?

It is important that you make sure you have provided all the necessary information on your application so that you can get the money as soon as possible. With Kallyss you can have the money in your account within 24 hours or the next working day as long as all the information you have provided is accurate and on the form.

The lenders we work with are able to provide fast lending decisions and can provide same day cash, including for people with bad credit. Therefore, providing the necessary information to the lenders is crucial so they are able to make a fast decision on your loan application whether to allow you to borrow money from them online or not.

9. How Will I Find The Right Lender For Me?

There are many different places where you can get a payday loan from. These include online options like Kallyss as well as payday loan stores which exist across the United States. However, going from payday store to payday store can be exhausting and can also take up many hours and even days. Looking online for a payday or other short term (or longer term) loan is more efficient and can be done from the comfort and safety of your own home, where you can compare many different lenders in your state much faster.

10. Do I Understand How Payday Loans Work?

Understanding that payday loans have a high APR and the interest on payday loans is higher than on most other loans is an important thing to realize before submitting your application. The idea of payday loans is that it is paid back on your next payday so if you are looking for a long term loan then a payday loan is not a good option for you. You should also, always look at and read and understand the terms and conditions of any lender before committing to any loan.

Once you have considered all of these things, you can submit your application with Kallyss and we will find the best lender for you to have the money in your account as soon as possible!