10 Best Bad Credit Payday Loans October 2023

If you’ve got bad credit and need access to short-term financing, payday loans could be a solution. Some payday lenders don’t run credit checks, so you’ll simply need to prove that you have income and that you can afford the repayment. 

This guide reviews the 10 best payday loans for bad credit in 2023. We cover everything you need to know, including minimum and maximum loan sizes, repayment terms, interest rates, and application speeds. 

The Best Payday Loans for Bad Credit Providers

Here’s a quick overview of the best providers offering bad credit payday loans in 2023:

1. ACE Cash Express: This direct lender offers payday loans to borrowers with bad credit. The minimum loan size is $100 and the maximum is determined by the state you live in. Depending on your circumstances, ACE Cash Express offers instant funding to a debit card or an overnight bank account deposit. 
2. Checkcity: Offers payday loans to residents in 12 US states. The entire application process can be completed online and loan amounts and APRs are determined by state regulations. There are just four application requirements; a valid government-issued ID, bank account, working phone number, and a steady source of income.
3. PaydayChampion: Offers payday loans for borrowers with bad credit. The minimum and maximum loan size is $100 and $5,000, respectively. PaydayChampion applications take less than five minutes to complete and it has an approval rate of 85%. Interest rates are determined by the lenders within PaydayChampion's network. 
4. AnyDayCash.com: Payday loan aggregator that connects borrowers with lenders in real-time. Applications take minutes and after approval, loan funds will be deposited into your bank account the next business day. AnyDayCash.com accepts loan applications from $100 to $5,000. 
5. Check ´n Go: Aimed at borrowers needing cash on a next-day basis. Check ´n Go is compliant with state regulations, so loan amounts and terms depend on where you live. Bad credit applicants are accepted and there’s no need to be employed full-time - Check ´n Go accepts all forms of income. Repayments can be made online with a debit card. 
6. Check Into Cash: Established payday loan provider with locations throughout the US. Online applications are also accepted and take minutes to complete. Check Into Cash offers payday loans from $50 to $1,500, depending on the state. After approval, the loan funds are deposited directly into your bank account - usually on the next business day. 
7. MoneyMutual: One of the largest payday loan networks in the US, MoneyMutual matches borrowers with lenders. The minimum and maximum loan amount is $200 and $5,000 respectively. The application process is fast and approved loans are often funded within 24 hours. Borrowers need to be earning at least $800 per month to qualify. 
8. NetPayAdvance: This payday lender offers direct financing in line with state regulations. Loan application decisions are made instantly and the loan funds are deposited into a bank account on the same day. Eligible debit card holders can opt for instant funding. Loan maximums and APRs vary depending on the state. 
9. Faaast Cash: Offers payday loans for any reason, starting from $50. The maximum loan size is $1,000, although lower limits might be in place for certain states. Bad credit applications are welcome and no hard credit checks are undertaken. Approved payday loans are funded the next business day via a bank account deposit. 
10. Speedy Cash: Established in 1997, Speedy Cash offers payday loans in-store and online. Various states are supported but maximum loan amounts depend on location regulations. Speedy Cash often approves applications instantly but additional information might be required. Loans can be funded instantly via debit card. 

Top Bad Credit Payday Loans Online Reviewed 

In the sections below, we review the top online payday loans for bad credit. Read on to choose the most suitable payday loan for your personal circumstances.  

1. ACE Cash Express - Direct Payday Lender With Instant Debit Card Funding or Overnight Bank Deposits 

ACE Cash Express is aimed at borrowers with bad credit who need access to fast cash. It offers several funding methods, including an instant debit card payment or an overnight bank account deposit. Alternatively, ACE Cash Express also has physical locations throughout the US, so you can apply in-store and receive cash. 

The minimum payday loan amount at ACE Cash Express is $100. The maximum amount depends on the state you live in. For example, those in Texas can borrow up to $1,500. However, California residents are capped at $225. The application process at ACE Cash Express is simple and fast. 

The lender always runs soft credit checks, meaning your FICO score remains unaffected. What's more, ACE Cash Express provides an instant decision on all loan applications. When filling out the application form, you'll need to provide a valid social security number. You'll also need to prove a steady source of income, which can be employment or retirement.

ACE Cash Express also requires proof of an active bank account that's been open for at least one month. Like most payday loans for bad credit, repayment is due when you next get paid. The funds will automatically be taken from your bank account via ACH. That said, ACE Cash Express also allows you to make the repayment manually. 

You can do this online, over the phone, or at an ACE store. In terms of interest rates, the APR based on a 14-day term is 661.69%. For example, if you borrow $100, the total repayment due would be $125.38. Late payment fees apply, which is the greater of 5% or $7.50. This kicks in if the repayment is more than 10 days later.  

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
Depends on the state. For example, Texas residents can borrow up to $1,500. California residents are capped at $225	Applications are usually approved instantly. Transfer options include instant debit card funding or an overnight bank account deposit	661.69% based on a 14-day term	Repayments are automatically debited from your bank account via ACH. Alternatively, manual repayments can be made online, over the phone, or in-store	Borrowing $100 on a 14-day term would require a total repayment of $125.38. Total financing charges of $25.38.

Visit ACE Cash Express

2. Check City - Bad Credit Loans Starting From $100 and an 85% Approval Rate

Check City is an online payday loan lender that considers applicants regardless of their credit score. It offers loans to residents of 14 US states. This includes Utah, Virginia, Alabama, California, Kansas, Texas, Wisconsin, Nevada, Colorado, Alaska, Idaho, Missouri, Ohio, and Wyoming. 

The loan specifics, such as maximum amounts and interest rates, depend on the state you’re applying from. Let’s use Alabama as an example. The maximum loan size is $500 and the minimum term is 10 days. Payday loans can be taken out for a maximum of 31 days. Check City takes a maximum of 17.5% of the loan amount as fees. 

For example, if you borrow $100 you'd be charged $17.50, so would need to repay $117.50. This amounts to an APR of 638.75%. This example is for Alabama only, so you'll need to check the terms for your respective state. In most cases, Check City approves payday loan applications within 15 minutes. 

Keep an eye on your email or telephone, as Check City might need additional information. Once approved, Check City will deposit the money into your bank account within one business day. Payday loan repayments can be made online with a debit card or via ACH. Check City also accepts in-store applications and repayments. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
Depends on state regulations	Applications are usually approved within 15 minutes. Payments are made within one business day via a bank account deposit	Depends on the state. For example, Alabama residents pay 638.75%	Repayments can be made online with a debit card or ACH transfer. In-store repayments are also accepted	Borrowing $100 on a 10-day term would require a total repayment of $117.50. Total financing charges of $17.50

Visit Check City

3. PaydayChampion - Bad Credit Loans Starting From $100 and an 85% Approval Rate

PaydayChampion is a referral lender that specializes in bad credit borrowers. It has a network of lenders that offer same-day payday loans to those facing financial difficulties. This means that you'll only be matched with lenders that meet your requirements. The minimum and maximum loan amounts at PaydayChampion are $100 and $5,000 respectively. 

The application process takes less than five minutes. Simply fill out the application form with the loan amount, repayment date, and other required details. PaydayChampion claims to have an 85% approval rate for bad credit borrowers. What's more, the initial application is based on a soft credit check, meaning it won't worsen your score further. 

PaydayChampion notes that applications made before 11 a.m. (EST) are often approved and funded on a same-day basis. However, delays can occur if additional documentation is required.  In terms of interest rates, PaydayChampion states that APRs are only displayed once the application is processed. 

That said, the minimum you can expect is $20-$40 for every $120 borrowed. As always, the state you live in can also determine how much interest you can be charged. When it comes to eligibility, the requirements at PaydayChampion are relatively low. For example, borrowers need a government-issued ID, an active checking account, and a social security number. 

Borrowers must be at least 18 years old and have a valid cell phone number. In addition, PaydayChampion also connects with lenders that offer 1-hour payday loans. This usually comes at a premium, meaning you’ll be charged higher interest rates and origination fees. Just make sure you review the loan agreements before accepting the terms. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
$5,000	Applications are often approved within five minutes. 85% approval rate. Same-day and 1-hour payday loans are available	Determined by the lender you’re matched with. Minimum of $20-$40 for every $120 borrowed	Within 2-4 weeks of your next paycheck. Repayments can be made online, in-store, or over the telephone. Payment methods are determined by the lender	N/A - determined by the lender

Visit PaydayChampion

4. AnyDayCash.com - Payday Loan Aggregator Offering Funding Between $100 and $5,000 

AnyDayCash.com is a loan aggregator that supports payday loans for bad credit. It has a sizable network of lenders and application times take less than five minutes. Once you’ve completed the application, you’ll be partnered with suitable lenders based on your personal circumstances. 

The minimum and maximum loan amounts are $100 and $5000, respectively. However, loan maximums can be lower depending on state requirements. To be accepted, you'll need to have been working with the same employer for the prior 90 days. You'll need to be a US citizen, aged over 18, and have a monthly income of at least $1,000 after tax deductions. 

In addition, you'll need a checking account in your name and a valid telephone number. In terms of interest, this is only displayed once you’ve submitted the application. This is because APRs and repayment terms are determined by each lender. Once you've accepted an offer, the money will be deposited in your bank account the next business day. 

There are no options for debit card funding. AnyDayCash.com partners with lenders that take repayments via ACH. This will be taken automatically when you next get paid. Some lenders will enable you to extend your payday loan, but this will depend on state regulations. This is also the case with late payment fees, so ensure you check this before accepting a payday loan. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
$5,000	Partnered lenders typically make loan payments the next business day via bank transfer. Approval times depend on the lender	Determined by the lender you’re matched with and the state you live in	Partnered lenders take loan repayments automatically via ACH	N/A - determined by the lender

Visit ANYDAYCash.com

5. Check ´n Go - Next-Day Payday Loans With All Income Sources Considered  

Check ´n Go is a payday loan lender that not only accepts applicants with bad credit but all income sources are considered. Whether you’re receiving income from a full or part-time job, retirement, or unemployment benefits, Check ´n Go will consider your application. The only requirement is that you have some income coming in each month. 

In addition, applicants must be US citizens and have a valid social security number. You'll also need a valid bank account that's been active for at least 30 days. The application process can be completed online and in some cases, you'll need to upload documentation. You'll be notified whether documents are required after Check ´n Go has reviewed the application. 

Check ´n Go is compliant with state regulations on payday loans, so terms will depend on where you live. This includes the maximum loan size and duration. To offer some insight, Texas residents can borrow up to $4,500 when applying online, or $5,000 in-store. The minimum loan term for Texas residents is 10 days and the maximum is 40 days. 

The main drawback of Check ´n Go is that it doesn’t display APRs or offer a representative example. Instead, this is only displayed once you apply for a payday loan. That said, you can review the loan terms before proceeding, so are under no obligation to accept anything. In addition to payday loans for bad credit, Check ´n Go also offers installment loans. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
Depends on state regulations	Approved loans are usually funded the next business day	Not displayed until you submit an application	Online debit card payments are accepted. Repayments can also be made in-store with cash	N/A - determined by the lender

Visit Check ´n Go

6. Check Into Cash - Established Payday Loan Provider With Financing Minimums of $50   

Check Into Cash is aimed at borrowers who need a little cash boost before their next paycheck. This established provider has locations throughout the US. That said, the fastest way to apply and receive funding is online. Borrowers can take a payday loan from just $50. The maximum loan is $1,500 but this will depend on your state. 

To qualify for a payday loan here, you'll need an active bank account, a government-issued ID, and a social security number. You'll also need to provide proof of income - all sources are considered. Like many payday loans for bad credit, Check Into Cash charges interest based on state regulations. 

For example, Indiana residents borrowing $100 on a 14-day term will pay interest of $15. This converts to an APR of 391.07%. Slightly lower APRs are offered on larger loan amounts. Depending on the state, Check Into Cash offers payday loan extensions if you're unable to pay on time. This includes variable payment plans (VPP) and extended payment plans (EPP). 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
$1,500	Most loans are approved within hours and funded on a next-day basis	Varies depending on the state. For example, Indiana residents pay a maximum APR of 391.07%	Online or in-store. Loans can also be repaid early or extended	Indiana residents borrowing $100 on a 14-day term will pay interest of $15. This converts to an APR of 391.07%.

Visit Check Into Cash

7. MoneyMutual - Extensive Payday Loan Network With Maximum Funding of $5,000   

Established in 2010, MoneyMutual is one of the largest marketplaces for bad credit payday loans. While state regulations need to be considered, MoneyMutual considers loan applications of between $200 and $5,000. You'll need to complete a quick online application form before being matched with partnered lenders. 

The minimum eligibility requirements are basic; you'll need to be employed or receive income from another source, such as retirement. Your monthly income should be at least $800 after tax deductions and you'll need an active checking account. What's more, only US residents aged over 18 can apply.

Like other loan networks, interest rates are determined by the lender you're matched with. You can review the terms before proceeding. MoneyMutual notes that many lenders deposit the loan funds within 24 hours. Although MoneyMutual doesn’t charge fees to use its marketplace, it collects commissions from its partnered lenders. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
$5,000	Approved loans are often funded within 24 hours	Determined by partnered lenders and state regulations	Depends on the lender	N/A - determined by the lender

Visit MoneyMutual

8. NetPayAdvance - Instant Payday Loans Without Hard Credit Checks    

NetPayAdvance is a state-licensed payday loan provider that offers direct lending. Therefore, you'll only deal with NetPayAdvance when applying for and receiving financing. It offers payday loans in line with state regulations, meaning maximums depend on where you live. This is also the case with interest rates and loan durations. 

For example, NetPayAdvance offers loans of up to $225 to California residents. But higher limits are available in other states. NetPayAdvance is one of the fastest options for bad credit payday loans. After you apply, it will make a decision instantly. NetPayAdvance will then make the loan payment on a same-day basis.

In fact, if you provide NetPayAdvance with an eligible debit card, the money will be deposited instantly. Otherwise, the funds can be transferred to your bank account. Crucially, NetPayAdvance doesn't run hard credit checks - so applications won't harm your FICO score. Repayments are taken automatically on your next salary date. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
Depends on the state	Loan application decisions are made instantly. Funds are then deposited onto a debit card instantly. Bank deposits are also supported	Determined by state regulations. For example, California residents pay an APR of 460.16% on a 14-day term	Taken from your bank account or debit card automatically when you next get paid	Depends on the state. For example, a California resident borrowing $100 over 14 days would pay $17.65 in financing charges.

Visit NetPayAdvance

9. FaaastCash - Loan Application Decision in 1-2 Minutes and Next-Day Bank Account Financing    

FaaastCash offers emergency payday loans for bad credit applicants. There are no hard credit checks and any financial circumstances are considered. FaaastCash offers a minimum loan amount of $50 and depending on your state, you could get up to $1,000. The application process is simple and loan decisions are usually made in 1-2 minutes. 

That said, FaaastCash is a payday loan aggregator, so it doesn’t directly lend money. Therefore, loan terms are determined by its partnered lenders. Nonetheless, approved loans are usually transferred to your bank account the next business day. Delays can occur if the lender requires additional documentation. 

The minimum eligibility requirements are that you're a US resident, have an active bank account, and be aged at least 18 years old. During the application, FaaastCash collects income and banking information. However, you won’t need to provide a reason for the loan. FaaastCash also offers cash advances, which could be a more affordable option. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
$1,000	Most loan applications are decided in 1-2 minutes. Partnered lenders typically deposit the loan funds in 1-2 working days	Determined by partnered lenders and state regulations	Depends on the lender, but usually when you next get paid or within 1 month	N/A - determined by the lender

Visit FaaastCash

10. Speedy Cash - Direct Lender Offering Payday Loans With Instant Payments After Approval    

Speedy Cash is the final option on this list of same-day payday loans with bad credit. Founded in 1997, this is one of the most established payday lenders in the US. Speedy Cash holds relevant licenses in all of the locations it operates, so state lending caps apply. Moreover, it’s a direct lender, so you won’t need to go through a loan aggregator. 

Speedy Cash has a fast application process. To qualify for a payday loan, you'll need a steady source of income and a government-issued ID. You'll also need an active checking account. Speedy Cash is able to make a decision instantly in some cases, although additional information might be required. 

Nonetheless, approved applications can be funded instantly if you have an eligible debit card. If not, you’ll receive the loan funds the next business day in your bank account. All payday loans must be repaid in full with interest when you next receive your salary. While most applications are made online, Speedy Cash also has physical locations in several states. 

Max. Loan	Approval and Transfer Times	APR rates	Repayment Options	Representative Example
Depends on the state	Applications can be approved instantly but might require additional information. Instant debit card payments or next-day bank deposits are available	Determined by state regulations	Various payment methods are accepted. Repayments can be made online or in-store	Not provided - depends on state regulations

Visit Speedy Cash

How do Payday Loans Work?

Payday loans are aimed at borrowers who need a small cash boost until they next receive their salary. In most cases, payday loans are taken out for a few hundred dollars as a short-term solution to financing. Payday loans can be applied for online, with applications rarely taking more than a few minutes. 

Although minimum eligibility requirements vary from one lender to the next, they’re often very basic. For example, most payday lenders require applicants to have a regular income source. However, this doesn’t need to be a full-time job, as some lenders accept unemployment benefits and pensions. 

In addition, most payday loans require borrowers to be at least 18 years old, be a permanent US resident, and have a valid checking account. Crucially, many payday lenders accept applicants with bad credit. In some instances, the lender will not even run a credit check, as they simply want to know that borrowers have some form of income. 

Once you’ve been approved for a payday loan - most lenders deposit the funds into your bank account. This will either be on a same-day or next-day basis. Some lenders also offer instant payments to eligible debit card holders. When it comes to repayments, payday loans usually need to be repaid when you next receive your paycheck. 

To avoid additional interest and late payment fees, the repayment should be made in full. It’s important to note that state regulations on bad credit payday loans are in full force. Most states limit how much can be borrowed. Moreover, many states determine the maximum payday loan duration and APRs. 

How Bad Credit Can Affect Taking Out a Payday Loan

There are some considerations to make when exploring small payday loans for bad credit. This is because a bad credit rating can have a negative impact on the overall loan experience. 

Let’s evaluate these factors in more detail so you can make an informed decision. 

Lower Approval Rates

Put simply, some payday loan lenders will not accept applications from bad credit borrowers. Each lender will have its own credit score requirements, which it often doesn’t make public. Nonetheless, bad credit payday loans will need to be taken out with specialist lenders. 

In many cases, these are lenders that do not make loan decisions based on credit ratings. Instead, they have other eligibility requirements that often rely on income. In other words, as long as you have some money coming in each month, you’ll likely be approved.  

Higher Interest Rates

Payday loan providers operate risk-averse business models. This means that the higher the risk of default, the more they charge in interest. Therefore, you might end up paying more interest if you’ve got a bad credit rating. 

The APR that you pay on a bad credit payday loan can be substantial. This is usually several hundred percent. Fortunately, many states have since introduced regulations on payday loan APRs. This limits the amount that can be charged. 

• For example, according to the Florida Office of Financial Regulation (FLOFR), payday loan lenders can not charge more than 10% of the amount borrowed. 
• This is in addition to a maximum verification fee of $5. 
• For instance, suppose a Florida resident borrows $100. The maximum repayment charge is $15 - which includes $10 interest and a $5 verification fee. 

Other states have their own limitations on interest rate limits. Nevertheless, before these regulations, payday lenders could charge any amount they wanted. Borrowers would often accept the terms anyway, due to financial desperation. 

Smaller Loan Sizes 

Those with bad credit are often limited in how much they can borrow. Once again, this is due to risk, as lenders need to factor in the possibility of default. That said, state regulations also play a part. 

This is because many states limit how much residents can borrow from a payday lender. For example, CNBC reports that since 2021, Hawaii residents have been capped to payday loans of $1,500. 

Additional Documentation for Approval  

One of the benefits of having good credit is that loan applications are often approved instantly. This is because the borrower meets the minimum risk threshold, so there are no requirements for additional information. This is rarely the case for those with a bad credit rating. 

On the contrary, bad credit payday loans often come with a cumbersome application process. Sure, the application form takes minutes to complete, but most lenders will ask for various documents before approving the loan. 

This almost always includes proof of income - you might be asked to submit payslips for the prior 3 months. You might also be asked for bank statements, government-issued ID, and even a signed letter from your employer. 

How do Lenders Score Credit?

According to the credit reporting agency Equifax, lenders look at your credit report when making loan decisions. There are several difficult factors that will be considered, such as:

• Number of Accounts: How many loans and other credit facilities you currently have, such as credit cards
• Repayment History: How you have historically handled your debit repayments. Late or missed payments will be viewed negatively
• Total Debt: The total amount of debt you currently have outstanding 
• Debt Utilization: How much of your total credit facilities you are currently using. High credit utilization is also viewed negatively by lenders.  

That said, over 90% of lenders will simply look at your overall FICO score - which is determined by the factors listed above. Your FICO score is extracted from one or more of the three main credit agencies - Equifax, Experian, and TransUnion. 

FICO scores range from 300 to 850. If your FICO is below 580, you’ll likely be viewed as a bad credit borrower. However, we should reiterate that credit scores are not always used by payday loan lenders - at least when making a decision. 

While they might run a soft credit check, this is often for verification purposes. It also enables them to get an overview of your credit history. However, in most cases, payday loans for bad credit are usually issued based on your income sources. 

Potential Benefits of a Payday Loan

Let’s explore some of the potential benefits of online payday loans for bad credit. 

Fast Access to Cash

Most payday loan lenders offer a speedy service. You’ll initially need to go through an application process, which collects personal, banking, and income information. You might also need to upload verification documents - but this isn’t always the case.  

That said, some payday lenders are able to approve applications instantly. Once the loan is approved, you could receive the funds on a same-day basis. Some payday lenders can instantly deposit the funds on your debit card. 

This means that the application-to-funding timeframe often takes minutes. What’s more, if you’re a returning borrower, your future applications could be approved immediately. 

No Hard Credit Check 

There are two types of credit checks to be aware of when exploring payday loans with bad credit. 

First, there’s a hard credit check. This is a comprehensive credit check that not only appears on your credit report but can negatively impact your FICO score. In fact, your FICO score will likely drop even if you’re approved. This is because applying for credit is a sign that you’re in need of financing. 

Second, there’s a soft credit check - which is used by most payday loan providers. This is a less comprehensive check and most importantly - doesn’t appear on your credit report. This means that soft credit checks won’t impact your FICO score.  

No Collateral is Needed  

Unlike secured loans, payday loans rarely require any collateral. This means that you won’t need to put an asset on the loan agreement for approval, such as a house or car. 

This is crucial, as if you default on the payday loan, the lender won’t have a claim on your assets. 

State Regulations Protect Consumers 

Several years ago, payday loan companies operated in the Wild West. There were little to no regulations, meaning lenders could charge as much interest as they liked. Moreover, they could also make their own terms regarding late or missed payments, leaving borrowers in a never-ending cycle of debt.  

Today, most states have introduced legislation to protect consumers from unfair lending practices. This includes limits on how much can be borrowed, interest rates, late payment fees, and maximum loan durations. 

For example, according to the National Conference of State Legislatures (NCSL), Colorado residents cannot borrow more than $500 from a payday lender. What's more, the maximum loan term is 6 months from the funding date. Some states are even more stringent - banning bad credit payday loans entirely. 

How to Choose a Payday Loan for Bad Credit

There are many options when searching for payday loans for bad credit online. Consider the factors discussed below when choosing a loan provider.

APRs

First, it’s important to understand what interest rates you’ll be paying before taking out a payday loan. This is known as the annual percentage rate or APR. In most cases, you won’t know what APR is being charged until you submit an application. 

This is because APRs are often determined by your FICO score and broader credit history. That being said, most states have introduced regulations on APR caps, meaning payday loan providers can’t exceed these limits.  

If they do, they’ll be breaking state laws. Crucially, look for payday lenders that charge below the maximum limit. This means you’ll be paying less back on the amount being borrowed. 

Other Payday Loan Fees 

Interest isn’t the only fee that bad credit payday loans attract. In fact, depending on the provider and the state you live, several other charges can apply. 

This includes:

• Origination Fee: Some payday lenders charge origination fees, which are in addition to interest. This is often a percentage fee based on the amount borrowed. For example, if you borrow $100 and the origination fee is 2%, you're paying an extra $2. 
• Late and Missed Payment Fees: Most payday lenders charge late and/or missed payment fees. According to Experian, ‘late’ payments are made after the loan due date, but before the grace period (e.g. 30 days). Payments are classed as ‘missed’ after the grace period has passed. 
• Verification Fee: Some states allow payday lenders to charge verification fees. This is to cover the costs of verifying your creditworthiness, identity, income, and banking information.
• Collection Fee: If you miss a payment, collection fees might be charged. This covers the costs of actively chasing payment. 
• Rollover Fee: If you need to rollover your payday loan to the next month, expect to pay additional fees. 

The payday loan fees mentioned above will vary depending on the lender and the state you live in. For example, some states put limits on rollover fees, while others do not permit them at all. 

To get a full 360-degree overview of fees, you’ll need to read the loan agreement. If the fees appear too high, you’re under no obligation to proceed. 

Loan Amount 

Next, you’ll need to check the minimum and maximum loan amounts offered by the payday lender. Minimums are often determined by the provider, as there aren’t any state regulations covering this metric. However, maximum loan amounts are usually capped by state limits. 

To offer some insight: 

• The maximum payday loan amount in Delaware and Iowa is $500. 
• In Wisconsin, the maximum is $1,500 or 35% of your gross income - whichever is lower. 
• In Nevada, there are no dollar limits in place - but you can't borrow more than 25% of your monthly income. 

Some payday lenders will offer less than the state maximum, so do bear this in mind. Moreover, you might be offered less than you applied for if you’re considered very high risk. 

Approval and Funding Times 

Bad credit payday loans are often sought after by those seeking emergency cash. Therefore, if you’re looking for fast funding, you’ll first need to check the average approval time. 

Some lenders are able to approve payday loan applications instantly or within a few minutes. This is often the case when using applying for bad credit payday loans from a direct lender, rather than a loan aggregator. 

However, if lenders require additional information, this will delay the approval process. For instance, you might be asked for extra payslips or bank account statements.

In addition, you should also check the average funding time when choosing a payday loan provider. Most payday loans are credited via bank deposits the next business day. This means that you might need to wait a few days when applying over the weekend. 

If you're looking for payday loans for bad credit with instant approval,  some lenders can credit the funds to your debit card immediately.

Lender Reputation  

Not all payday loan lenders operate murky businesses - but some do. Therefore, it’s important to do your research on the lender’s reputation. 

For example, search for the lender on TrustPilot to see how it's rated by previous customers. Anything above 4/5 across a large number of ratings is a good sign. 

You can also check the lender’s score on Google, alongside any reviews that have been left. 

We’d also suggest assessing whether the lender has a license in your state. This will ensure it’s operating legally and within state lending regulations. 

Repayment Terms   

It’s crucial you understand the repayment terms before accepting a payday loan offer. This will be outlined in the loan agreement, which you read thoroughly. 

First, you’ll need to know the repayment date set by the provider. This will usually be the same day that you next receive your salary. If it’s before this date, you might want to ask the lender to adjust the loan agreement. 

Otherwise, you face the risk of missing the payment and being charged extra fees. Next, check how the payday loan repayment should be made. This can vary widely depending on the lender. 

For example, some lenders will automatically take the repayment from your bank account. They can only do this after you’ve provided authorization. This could be the best option, as it will ensure the payment is made on time. 

Alternatively, some payday loans require you to make the repayment manually. You can usually do this online with a debit card or ACH transfer. If the payday loan provider has a physical store in your state, you can usually pay with cash.  

Bad Credit Payday Loans Qualifying Requirements

Many payday lenders accept borrowers with bad credit. However, lenders will still have minimum qualifying requirements in place - which you’ll need to meet to be approved. 

Our research found that the main requirements as are follows:

Across most lenders offering payday loans with bad credit, you’ll need to meet a minimum income requirement. This is usually a minimum of $800-$1,000 - but will vary depending on the lender. 

We found that in most cases, payday lenders prefer employment income. You’ve got a much higher chance of approval if you’ve been with the same employer for at least a few months. But the longer the better. The lender can verify this by requesting recent payslips.

However, some payday lenders accept other forms of income. For example, pensions and even unemployment benefits. They simply want to know that you have the means to repay the loan. Flexibility is often available, but you’ll need to provide documents to prove the income is there.  

Identity and Residency 

Even the best online payday loans for bad credit come with identity verification requirements. For a start, you’ll need to be at least 18 years old. In some states, the minimum age is higher. Some lenders will ask for a government-issued ID, such as a driver’s license or state ID card. 

What’s more, payday loans will usually only be issued to permanent US residents. Some lenders require full citizenship, so you’ll need to check this before proceeding. The lender will likely collect your social security number too. 

Active Checking Account 

You’ll also need a checking account to get a payday loan. This is because most lenders fund payday loans via direct bank deposits. 

Moreover, some payday lenders collect repayments automatically from a checking account. This ensures they receive the repayment on the date you next get paid. 

Minimum Credit Score

Although many payday lenders offer loans to bad credit borrowers, they might still have a minimum FICO score threshold. For example, a FICO score of between 300 and 579 is considered ‘Very Poor’. 

However, the payday lender might not accept anything below 400. Therefore, you should assess whether any FICO minimums are in place when choosing a payday loan provider. 

Things to Consider Before Taking Out a Payday Loan

Make sure you’ve thought carefully about the risks of taking out a payday loan. The main considerations to make are discussed below. 

Ensure You Can Afford to Repay the Loan on Time

It’s crucial that you’re able to repay the loan - on time. Not only the principal amount but all interest and fees collectively. If you’re unable to meet the repayment, this can result in additional fees. 

For example, most payday loans come with late and/or missed payment charges. While some providers allow you to roll over the loan until the next month, this will also result in extra fees. 

Ultimately, if you can’t afford to take out a payday loan, you should consider other options. Otherwise, your debt can quickly spiral out of control. 

Consider the Impact on Your Credit Score 

If you’re using a payday lender that runs hard credit checks - this will negatively impact your FICO score. This is the case regardless of whether or not you’re approved. This is the same as any other type of financing application, such as credit cards or personal loans.

That said, if the lender only requires a soft credit check, your FICO score will not be impacted. However, you also need to consider the implications of failing to repay the loan on time. If you miss the repayment, the payday lender will likely report this to the credit rating agencies. 

Not only will this harm your score but also your ability to secure credit in the future. According to American Express, late payments remain on credit reports for 7 years. 

Payday Lenders Might Call Your Employer 

Many payday lenders will need to verify that you’re employed. Not only through recent payslips but by calling your place of work. This is to ensure you’re currently employed, as stated in your loan application. 

Although lenders will typically be discrete, they’ll likely need to reveal where they’re calling from. As such, your employer might know that you’re taking out a payday loan.

Payday Loans Should Only Be a Last Resort 

It’s important that payday loans are only being taken out as a last resort. It’s wise to first consider financing from alternative sources, such as family and friends. Although this can be an awkward conversation, it’s likely a better option in the long run. 

In addition, it’s crucial that payday loans are only being used for non-discretionary expenses. This means absolute necessities, such as rent, food, or fuel. Never take out a payday loan for non-essentials.    

How to Increase Your Credit Score

While payday loans can help cover a shortfall in cash, it’s important to look at the longer-term picture. By this, we mean making every effort to increase your credit score. In doing so, you won’t need to rely on bad credit payday loans to raise finance. 

Moreover, you’ll have a much higher acceptance rate with traditional lenders and be able to secure lower APRs. A good credit score is also crucial should you want to get a mortgage. 

Here are some proven tips that can help you improve your FICO score:

• Always Make Payments on Time: First, make sure that you never miss a repayment, whether that’s a payday loan, credit card, or store card. As we established, missed payments remain on your credit file for 7 years. This will hinder your ability to increase your FICO score.  
• Reduce Your Credit Utilization: Next, make every effort to reduce the amount of credit being utilized. If you’re using too much credit, it appears that you’re reliant on it for day-to-day expenses. In contrast, low credit utilization shows that you can handle credit sensibly - which will improve your FICO score.   
• Avoid Applying for New Credit: We also established that applying for a payday loan will hinder your credit score - should the lender perform a hard credit check. This is the case with any type of credit application. Therefore, to improve your FICO score, avoid applying for new sources of credit.
• Check Your Credit Report for Potential Issues: You’d be surprised how often credit reports contain incorrect information - such as late repayments or credit that was never taken out. Spend some time reviewing your report from the three main credit agencies - Equifax, Experian, and TransUnion to ensure everything is correct. If there’s an error, you can get it removed - which will improve your FICO score. 
• Consider Debt Consolidation: A more effective option could be debt consolidation. This means taking out a loan to cover all of your outstanding debts. Not only can debt consolidation secure more favorable interest rates, but it can improve your FICO score. This is because your credit utilization will be lowered and you’ll have fewer credit accounts open. 

Are Payday Loans Safe?

Payday loans are generally safe, but there are some considerations to make before proceeding. For a start, make sure that payday loans are legal in your state. If they’re not, and you’re offered a payday loan by a lender, they’re doing so illegally. 

If payday loans are legal in your state, check what restrictions are in place. For example, the maximum interest and fees that can be charged, and the longest repayment duration. Payday lenders must comply with these regulations, but not all do. 

You’ll also need to ensure that you can realistically repay the payday loan in full and on time. Failure to do so can result in additional fees and a negative impact on your FICO score. It’s also important that you use a lender that takes privacy and data protection seriously. 

Your details shouldn’t be shared with other lenders without your authorization. Moreover, the payday provider cannot take funds from your bank account unless you have agreed to this. Ultimately, payday loans should only be considered as a last resort. 

Conclusion

In summary, payday loans can offer a lifeline when you need access to emergency cash. Even with bad credit, the qualification requirements are often very low. However, it’s crucial you consider the risks before taking out a payday loan. 

Not only will you pay high interest rates but applying for a loan can impact your credit score. Moreover, there will be further complications if you’re unable to repay the loan on time.  

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References

• https://flofr.gov/sitePages/PaydayLenders.htm
• https://www.cnbc.com/2021/06/18/hawaii-enacts-new-restrictions-on-payday-loan-rates-and-repayments.html
• https://www.equifax.com/personal/help/lenders-credit-scores
• https://www.myfico.com/credit-education/fico-scores-bridge
• https://www.ncsl.org/financial-services/payday-lending-state-statutes
• https://www.consumerfinance.gov/ask-cfpb/what-is-a-credit-card-interest-rate-what-does-apr-mean-en-44/
• https://www.experian.com/blogs/ask-experian/what-is-difference-between-late-payment-missed-payment/
• https://www.cnbc.com/select/what-is-a-bad-credit-score/
• https://www.americanexpress.com/en-us/credit-cards/credit-intel/late-payments/

FAQs

Do payday loans have a credit check?

Some payday loan providers do not run credit checks, meaning that all financial circumstances are considered. However, you’ll still need to prove that you have a regular income. 

Does taking out a payday loan affect my credit score?

If the payday lender runs a hard credit check, this will negatively impact your FICO score - even if you’re approved. However, soft credit checks will not impact your score.

Do you need good credit to get a payday loan?

Not always, as many lenders offer bad credit payday loans. You’ll need to meet other qualification requirements, such as having an income and an active checking account. 

Can I get a payday loan with very bad credit?

Yes, some payday lenders approve loan applications regardless of your credit score. They’ll look at other factors, such as how much income you receive each month. 

What’s the easiest loan to get with bad credit?

Payday loans are by far the easiest loan type for those with bad credit. Many lenders do not run credit checks, but do remember that payday loans come with very high-interest rates. 

What is the interest rate on bad credit payday loans?

Payday loans are regulated in most US states, meaning that interest rates are now capped. Check your local state regulations to assess the maximum APR. 

How much can I borrow with a bad credit payday loan?

Some states have introduced limits on payday loan applications, which lenders must comply with. For example, Alabama residents can only borrow up to $500. 

Are payday loans and short-term loans the same?

No, although both are short-term loan agreements, repayment timeframes differ. Payday loans are usually repaid when you next receive your salary, while short-term loans often extend up to 1 year. 

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