If you need a loan but your credit isn’t strong enough for a bank, a direct payday lender is one alternative. When you apply, you have two main choices: go straight to a payday lender or use a loan connection service that matches you with lenders.
Connection services can be helpful, but none of them work with every lender. And if you’re in a hurry, applying with a direct lender is usually faster. They review your application, send the money if you’re approved and work with you directly until the loan is paid off.
Just keep in mind: payday loans are very expensive, much costlier than traditional loans. They should only be used in true emergencies, when you have no other options and feel confident you can repay the loan on time. You have other short term options, such as direct cash advance apps that don’t check your credit and may be a cheaper option that a payday loan.
A direct payday lender, or short-term loan provider, is a lender that directly provides small-dollar loans, rather than working with an outside company. This means that your information stays in one place, but you won’t get a chance to shop around and compare your options.
These lenders offers small-dollar loans that are typically due between 14 and 30 days, typically for a flat fee of around $15 for ever $100 borrowed. However, there are other types of short-term lenders that also offer loans directly and may be a better option.
Depending on the type of lender, you can apply online or in store, and the process usually takes only a few minutes. Most payday lenders give you a quick approval decision and once you sign the agreement, you’ll need to repay the loan, plus fees on your next payday. Online lenders typically deposit the money directly into your bank account, while in-store lenders give you cash or a prepaid card on the spot.
Payday loan rules vary widely by state, including how much you can borrow, your repayment window and wether rollover are allowed. A lender that’s legal in one state may not operate in another.
And, some sort-term options, like cash advance apps, are only available online.
Direct lenders are usually cheaper and safer than payday loan brokers. Brokers work by sharing your info with multiple lenders to see who will approve you, which means you often don’t get to review all the privacy policies first. Many people who use brokers also complain about getting nonstop calls from lenders. That said, brokers can be helpful if you’re struggling to find a loan on your own. They might know about lenders or loan options you haven’t heard of. If you’re new to borrowing, a broker can guide you through your first application.
Payday loans are one type of short-term loan, but it isn’t the only short-term loan option. In many cases, it’s the most expensive and riskiest type due to high fees, very short repayment windows and the potential for having to roll your repayment into a new term. Other short-term borrowing options can be cheaper, easier to manage or come with more flexible terms. Here are some alternatives:
If you’re considering a payday lender, it’s worth checking these alternatives first. They still have fees or requirements, but many cost far less than traditional payday loans and offer more breathing room for repayments.
We currently don't have that product, but here are others to consider:
How we picked theseThe Finder Score crunches 3+ types of short-term loans across 65+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10.
To provide a Score, we compare like-for-like loans. So if you're comparing the best short-term loans for all credit types, you can see how each short-term loan stacks up against other short-term loans with the same borrower type, rate type and repayment type.
Not all direct short-term loan lenders are the same. Pay attention to these points while comparing lenders:
You might want to use a direct short-term lender in the following situations:
For many short-term lenders, applications can easily be completed and submitted online. In order to secure a loan, you’ll need to meet some qualifications, which generally include:
If all of the requirements are met, there are usually just a few steps to apply. While the actual application will vary by lender, you’ll generally need to:
What can I use the money for?
Like all payday loans, you can use it for just about whatever you want. If you’re late on bills, missed your rent payment or have an unexpected emergency pop up, a short-term loan can help cover these expenses.
What is the maximum amount I can borrow?
The state you live in and your monthly income will determine this. The maximum loan amount can also vary between different direct short-term lenders.
How do I repay the loan and when?
You’ll have to repay your payday loan on or before your next payday. Most lenders take the money directly from your bank account, but some give you other options as well.
How does a late payment or not paying at all damage my credit?
Upon nonpayment, your lender can initiate collection, which in turn would have an adverse effect on your credit score.
What if I repay my direct payday loan early?
If you’ve come into some extra cash and want to pay off your loan early, it’s best to check with your lender. It might charge you early prepayment fees.
What is Teletrack?
Teletrack is a credit reporting service agency that collects information for businesses like short-term loan companies, rent-to-own and furniture stores that offer financing. Your Teletrack report will note your loan history with these types of lenders as well as if your contact information matches up with what you’ve reported in the past
Borrow up to $5,000 in Utah and Nevada — even without a bank account.
Find out who’s taking out payday loans and what they tend to need the money for.
If you’re in Nashville and need a quick cash advance, read this guide.
These legitimate lenders and a selection of potential alternatives to help you gain more control over your finances.
Will I be able to get cash by Friday?
Hi Steve,
That will depend on when you have applied and got approved. In most cases, if your loan has been approved, you can expect the funds to be deposited in your bank account as soon as the next business day. It would be a good idea to confirm this with the lender as the receiving bank could have its own clearing cut-off time.
Kind regards,
Liezl