Even if you can’t get a payday loan in your state, you still have other loan options.
What's in this guide?Jump to…
Can I get a payday loan in a different state?
It depends on your situation. You won’t be able to visit a nearby state to get a payday loan, even if they’re legal in both states. This is because payday loan laws differ state to state. Lenders are required to lend only to people in states they are licensed in, and people from a different state are prohibited from borrowing.
However, if you’re a permanent resident of a state where payday lending is legal but are temporarily living in another state, you may still be able to get a loan. Your lender will likely require more documentation to prove your address, and you may be limited to a selection of online lenders.
What are some alternatives to payday loans?
Payday loans aren’t the only option out there. If you’re unable to get one in your state, then there may be another way to handle your short-term financial issues.
Installment loans are another type of short-term loan that you can use for just about any expense. Unlike payday loans, an installment loan won’t be due on your next payday. Instead, you’ll have a few months to pay back your principal plus interest. Because of this, installment loans are generally considered a safer option. Many states that prohibit payday loans don’t have laws against installment loans, but you still need to be wary. Installment loans are still an expensive form of credit, and you should always make sure your lender is licensed to operate in your state before signing a loan agreement.
Tribal lenders belong to sovereign Native American tribes. This means they can lend in states where payday lending might otherwise be illegal, but this means they can charge much more in interest than other lenders. Examine your terms carefully to be sure you won’t be spending hundreds of dollars in interest and other fees. While they are generally safe to borrow from, tribal lenders can be very expensive.
Borrowing isn’t always the option you want to take. If you have long-term financial problems, then you should look into payday loan alternatives to find an option that can help fix common debt problems.
A few solid options include:
- Ask for help. Your loved ones may be more willing to help than you think. If you’re suffering from a money crisis, friends and family are usually glad to give a helping hand.
- Negotiate with your creditors. Talk with your creditors about making repayments. You may be able to negotiate a different payment plan that makes it easier for you to afford your current debt.
- Find credit counseling. If you’ve got some time, consider looking for credit counseling. A community assistance program can work with you to get your finances under control, often free of charge.
Installment loan options to consider
If payday loans aren't legal in your state, the loan offer could be a scam
When you see payday loans advertised in states where they’re prohibited, it should be an immediate red flag. Predatory lenders are known to work around legislation and can end up trapping you in a cycle of debt with interest rates and fees that are well above the legal limit.
Even worse, you could be called for collections on a loan you didn’t take out. Scam artists will sometimes fake being a collector for a loan you may have applied for but didn’t end up accepting.
If you think you may have fallen into a payday loan scam, get in contact with the police and your state attorney general for information on how to proceed.
Can I have multiple payday loans at one time?
It depends on the laws of your state and the lender you choose to borrow from. If it’s legal, many lenders often require that you have repaid a certain percentage of your existing loan before being eligible for a second one. When you’re applying, ask the provider for its policy or check its FAQ page for details.
Some lenders restrict borrowing multiple loans, and others go as far to prohibit consecutive borrowing within a specified period of time. This is because multiple payday loans are often a sign of structural problems with your debt, and adding on to it won’t help. You’re more likely to default and wrack up excessive fees, so it it may be time to reevaluate your situation and look for alternatives.
Are payday loans permitted in my state?
States authorize different laws and statutes around payday lending. The reason for these differences lies in how each consumer protection office handles high-risk borrowing.
If you’re unsure whether your state allows payday loans, check out the interactive map below for payday lending regulations in your state:
Will I need to repay a payday loan if it’s illegal in my state?
It depends. You’ll first want to see if the loan you took out is actually prohibited in your state. Some lenders market a loan as a “payday loan” when it doesn’t fit the requirements of your state’s legislation.
Once you’ve confirmed it’s illegal — either because it’s prohibited by law or borrowed from an unlicensed lender — you can start researching if you’ll need to pay it back. In some states, you’re only required to repay the principal. Others states require that you pay back the entire amount, interest and all.
To find out whether you need to repay a payday loan, contact your state’s consumer protection office. They should provide information on what is and isn’t legal when it comes to short-term lending.
While you won’t be able to borrow a payday loan form a different state, you aren’t out of options. With a variety of alternative financing solutions out there, you can pay for whatever unexpected expense has cropped up even if you can’t take out a payday loan.