Yes, you do need a checking account in order to secure a payday loan. A checking account allows a lender to obtain payment from you. It also allows you to receive your cash advance fast. While the requirements for a payday loan are minimal, there are a few you should be aware of.
Payday Loan Payments
Payday loan payments are structured differently than other forms of credit. You don’t receive a bill in the mail for a series of monthly payments. A cash advance loan is paid off entirely on your next payday.
Your lender will automatically deduct the amount from your checking account unless you make prior arrangements. With online lenders they will withdraw funds as if you made a purchase with a virtual check or debit card.
Of course, you can make a partial payment. But that will cost you more in fees. You simply call or fax your lender a notice prior to your payday. They will still deduct the lending fee, but that is usually between $10 and $35.
Receiving Your Cash Advance
A checking account also allows you to receive funds quickly from your lender. Within a matter of hours, online cash advance companies can wire your money into your checking account. By the next morning, you will have the funds to take care of your bills.
Other forms of credit can’t work that fast. Credit cards take weeks to receive in the mail. Personal loans can take days to receive your cash through a check or wire transfer.
Other Payday Loan Requirements
Payday loan requirements are fewer than other forms of credit. You don’t have to have a proven payment history, assets, or collateral. Cash advance companies do ask that you be at least 18 years old, have a reliable source of income, and a permanent address.
With many online payday loan companies, you simply entire the information online through a secure server connection. They will then verify the information through their sources. Other companies ask for faxed documents. While the process can be a hassle, they sometimes offer better rates.
Some states also have additional requirements. Some state governments limit the amount of your cash advance and how many you can have open at once.
Shopping lenders will give you the best deal and the most options when choosing your payday loan.
Here are our Recommended Payday Loan Companies online.
Carrie Reeder is the owner of ABC Loan Guide , an informational website about various types of loans.