Understanding Loan Terms

3 Things to Know About Repaying a Payday Loan

17 August 2021

Stanley Simmons

Getting a payday loan offers a way to have some extra cash quickly without a credit check. As a result, many people choose payday loans when they need some money for their bills or unexpected expenses. However, if you get a payday loan, you might have some questions about repaying it. Here are three vital things to know about repaying a payday loan.

1. The Lender Might Set Up Repayment When Issuing You the Money

It is not uncommon for payday loan lenders to set up repayment loan options when issuing them. How do they do this, you might wonder? There are several methods they might use. One option is to ask you for a check for the total amount you owe. You can postdate the check to the loan's due date for the total balance you owe. If you choose this option, the lender will hold onto the check until the due date. On that date, the lender will cash the check. If the check bounces, you will owe the lender all the money plus any additional fees they charge and the bank charges.

The other option is to set up an electronic repayment of the money you owe. If you choose this option, they will submit an electronic request for the funds on the due date. Again, if the payment does not go through on time, you will have additional fees to pay to the bank and the lender.

2. The Repayment Includes All the Fees

The second thing to know is that the payment amount will contain all the fees you owe. Therefore, the payment amount might be more than the amount you borrow. If they take the fees from the proceeds, the repayment amount might be equal to the total loan amount you requested.

3. You Can Rollover the Loan

If you cannot afford to repay the money when the due date comes, call the lender ahead of time. If you call the lender ahead of time, they will postpone the due date, but they will also charge you a fee to rollover the loan.

Learning these things about repaying a payday loan is vital if you plan to take one. Before you take one out, ask the lender any questions you might have about the fees, costs, or repayment of the loan. If you are ready to apply, visit a lender in person or online today.

Share

About Me

When was the last time you realized you were in the red financially? Although most people don't think about their finances on a day to day basis, it can be easy to find yourself living paycheck to paycheck if you aren't careful. I began thinking carefully about the financial implications of some life decisions I was making, and I knew I had to make a difference. I talked with a loan officer about getting things together, and he was instrumental in helping me to work things out. Read more about my financial successes and failures on this little website. You might be able to avoid some of my previous mistakes.