No Checking Account Payday Loans

Many consumers seek a payday loan when they have an immediate need for money or need to pay for some emergency expenses. As the name suggests, payday loans are generally advanced to someone and will need to be repaid by the time they receive their next pay check. Therefore, you could say that payday loans are short-term loans. They are notorious for their high interest rates and fees, and so should not be used in the same way as traditional personal lending, and simply if a consumer find themselves with a financial emergency and has no other alternative.

There are 3 basic eligibility criteria with a payday loan and these are that the applicant must be aged 18 or over, they have a checking account, and they have a monthly income of at least $1,000. The vast majority of lenders will require an applicant to have a checking account, as this will allow them to check a potential borrower’s income and expenditure. In addition to this, most payday lenders will want to set up an automatic payment from a checking account to repay the loan on a predetermined date.

In fact, it is true to say that all state-licensed payday loan providers will require an applicant to have a checking account in order to qualify for a loan. However, there are now many lenders that will provide a payday loan without the need for a checking account, although applicants should initially be wary, as these lenders are unlikely to be licensed at state level.

Payday loans have evolved a lot over the past few years, and many of these loans are offered to borrowers that have bad credit or a poor credit history. Unfortunately, many of these potential borrowers may not have a checking account, as they are ineligible due to their credit standing, and therefore they may find it extremely difficult to borrow money through conventional methods.

With that said, many payday lenders will now issue a payday loan as long as they can verify an applicant’s income. This can typically be achieved through viewing pay checks and W-2’s. It is also possible to have the funds from a payday loan deposited directly to a savings account, thus allowing an applicant to access their money immediately. However, in some cases if an applicant does not have a checking account, the money will be forwarded in the form of a check and the individual will need to cash this check at an appropriate company.

A payday lender will also be taking a far higher risk by offering a payday loan to an applicant that doesn’t have a checking account, and this is typically reflected in the interest rates offered. As previously mentioned, payday loans are renowned for their extremely high interest rates anyway, and this is likely to be even higher in this scenario.

A payday loan without a checking account will typically be limited to $100 to $1000, although this will very much depend on the individual lender. Even if a consumer wishes to borrow this money for a short-term period, generally for less than a month, they can expect to be charged an amount ranging from $20 to $80 for this loan. If this type of loan was obtained for over a year the equivalent APR could quite easily be well over 100% to 1000%. This is actually quite shocking if you consider that traditional personal loan funding ranges from 6% to 20%.

Payday loans also differ from conventional bank loans, as there is typically far less paperwork to complete. There are even lenders who will not require any paperwork whatsoever, and are happy to complete the entire process electronically. As mentioned, payday loans are often issued to people who have a less than stellar credit rating and often lenders will not even obtain a credit check.

However, no matter how good this type of lending sounds, it is important to remember that a lender is running a business, and therefore they will be looking to make a profit. Payday loans are often “rolled over” and set to run to an applicant’s next pay date if they are unable to repay the money this time around. This will, of course, result in further fees and interest being charged and it is not unheard of for individuals having to repay 2, 3 or 4 times the amount that they have initially borrowed within a relatively short period of time.

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