If you’re considering getting a short term loan in Washington, D.C., don’t apply before learning all the facts.
A short term loan can seem like a lifeline when you have less-than-perfect credit and you’re looking to borrow a small amount of money when you’re short on cash. Before you sign any contracts, get the information you need below.
Are payday loans legal in Washington D.C.?
Payday loans are not legal in Washington, D.C., this is because of the high interest rates they typically attract. Amended District of Columbia Code Section 28-3301 governs the functioning of small loan providers in D.C.
If you take a small loan in D.C., there is an APR cap that will ensure that you don’t have to pay more than 24% as an annual rate. This is considerably lower than what payday lenders across the nation charge, which is why they choose not to operate in this part of the country.
Keep in mind that if you choose to apply for any kind of loan or line of credit, it’s very important read all the paperwork (including all the fine print) before signing anything. It’s also a good idea to have a solid plan to pay back your loan, so you don’t find yourself needing to borrow more money to repay debt. Go through this guide to find out about your alternatives.
What other borrowing options do I have in Washington D.C.?
While high interest payday lending is illegal in D.C. you can think about getting credit in other ways, which include:
- Personal loans. Secured loans, debt consolidation loans, peer-to-peer loans and home equity personal loans are all different types of personal loans that are available.
- Credit cards. Depending on your situation, you could look into a credit card with an introductory low or no-interest period to give you a line of credit for expenses.
- Installment loans. Installment loans generally have a longer term to pay back your loan, but can have high of APRs.
- Balance transfers. When it comes to debt consolidation, it may be worth transferring your debt using a balance transfer credit card. This could get all of your outstanding balances into one place, potentially with a lower interest rate.
- Tribal loans. If you live in a state (or district) where payday loans are illegal, you still have the option of getting one if you go through a tribal lender like Blue Trust Loans. Since these lenders are based on tribal land, they are considered a sovereign entity and are able to abide by their own laws.
Installment loans you could apply for
An installment loan requires that you repay the money you borrow in installments over a predetermined timeframe. Some lenders offer these loans to applicants with less-than-perfect credit, provided they can demonstrate an ability to repay. Similar to payday loans, the interest is very high and there are some risks you should consider when applying.
- If the provider quotes a different rate to the one above please let us know
What if I can’t get a loan or credit card?
A short term loan may be a bust, but there are other options out there. Some you may have tried, but all may be worth looking into.
- Borrow from people you know. You may be able to request an advance from your employer, or get a loan from friends or family.
- Talk with community organizations. Non-profit financial cooperatives and community credit unions may have options for small-amount loans if you meet their eligibility criteria.
- Talk to your creditors. Ask about arranging a payment plan or getting more time.
- Local social services. Look into public services for assistance with heating costs, food and housing.
- Pick up side work. Looking for side jobs, selling things online, or signing up to drive with a company like Uber are some of the many ways people get extra cash when they’re in a bind. It’s a great alternative to getting a loan or credit card because there is nothing to repay.
What are the typical costs of a Washington D.C. loan?
When you get credit of any kind you have to repay the amount you borrow along with the interest it attracts as well as all applicable fees and charges. The APR is more accurate in representing the total cost of your loan. This is because the APR takes into account fees as well as interest. The APR can vary considerably depending on the kind of credit you get, the credit provider you choose and your creditworthiness.
There are instances when you may have to pay additional fees. For example, if a payment does not go through because of insufficient funds in your account you may have to pay NSF fees. If you make a payment after its due date, you may have to pay late fees. Some lenders may charge application fees and loan disbursement fees as well.
Frequently asked questions
I’m in D.C. temporarily and my license shows me to be a resident of Florida. Can I apply for a Florida payday loan online?
Yes, you can. In this case, Florida payday lending laws would apply.
I’ve noticed that some online lenders from other states offer no credit check short term loans in Washington D.C. Are these loans legal?
No, they’re not. Out-of-state lenders cannot provide payday loans in Washington D.C. legally.
Who can I contact to file a complaint about cash advance providers in D.C?
You should direct all complaints surrounding cash advances in District of Columbia to the D. C. Department of Insurance, Securities and Banking.
Can I get an auto title loan in Washington DC?
No, you can not. Due to the high interest rates and the frequency of borrowers defaulting on their loans, title loans are illegal in the nation’s capital.