What you need to know before applying for a payday loan in the treasure state.
If you find yourself low on cash and are looking to borrow a small amount of money, you may be considering a payday loan. Find out how payday loans work in Montana and what you’ll need to know when applying for one.
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- Min. Loan Amount: $500
- Max. Loan Amount: $5,000
- Turnaround Time: 1 business day
- Loan Term: 9 to 36 months
- Requirements: Direct deposit, meet minimum income requirements
What does a payday loan in Montana cost?
Payday lending is legal in Montana. They are governed by Montana Code Annotated 31-1-701 et seq., which is the Montana Deferred Deposit Loan Act. Lenders must be licensed by the state before they can offer loans, and Montana law highly regulates lenders to help protect consumers.
- Minimum loan amount: $50
- Maximum loan amount: $300 or 25% of your gross monthly income
- Loan Term: 31 days or less
- APR: Montana law caps payday loan APR at 36%
- Finance charge: A 14-day $100 loan costs $1.39
- Collection fees: Lenders may charge one $30 non-sufficient funds (NSF) fee
You are not allowed to roll over or refinance your loan so be sure you’ll be able to repay what you borrow before you agree to a contract. Defaulting on loans is expensive and can lead to a cycle of debt that can be hard to get out of.
Be careful of online lenders
Montana has a 36% interest rate cap on payday loans, even for online lenders. If you’re shopping online and comparing offers, be sure to note how much the lender plans on charging you in the form of APR. In the past, some tribal lenders have been charging more than the legal interest to consumers. This can cause major debt, so you’ll want to avoid any loan that doesn’t abide by Montana law.Compare short-term loans in Montana
How can I apply for a payday loan?
All lenders require that you be 18 years old, an American citizen or permanent resident and have a regular source of income.
Whether you apply online or at a store location in Montana, you’ll have to provide some personal details. This includes your Social Security number, your home address, how much you make and your current employment situation. If you choose to apply online, you’ll also have to supply access to your personal checking account so the lender can deposit your loan amount and debit your payment when it’s due.
What should I consider before taking out a payday loan in Montana?
Because payday loans can be expensive, you’ll want to consider some other options before applying. Montana offers programs to help people with low incomes. If you’re having trouble paying your bills and your debt, you may want to look into Low-Energy Assistance, the Supplemental Nutrition Assistance Program (SNAP) or Temporary Assistance for Needy Families (TANF).
You may want to consider other types of credit, too. Installment loans and credit card cash advances offer longer repayment periods, though they have high interest as well.
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Bottom line
If you need a payday loan, Montana law has good regulations in place to protect consumers. It’s always a good idea to look at your budget and make sure you can afford to pay back your loan, but if you’re short on cash, a payday loan can be the solution you need.