Payday loans typically don’t require a credit check and can be obtained even with poor credit. However, they come with a high interest rate and can lead to a cycle of debt.

In addition, if you default on the loan, the lender can send it to collections, UT which damages your credit even more. Fortunately, alternatives exist.

They’re easy to get

Whether you choose to apply online or in person, payday loans are deceptively easy. All that is required is proof of income and a bank account. In fact, you can get a payday loan in about 15 minutes, or even less if you go to a store that doubles as a check-cashing place or pawn shop.

However, they come at a high price: borrowers often pay more in fees than the amount borrowed. In addition, these short-term loans trap people in a cycle of debt. Instead, try using a credit card cash advance or asking for help from family and friends.

Many local charities and churches also offer financial assistance. While they don’t offer as much money as a payday lender, their interest rates are significantly lower. In addition, some community banks and credit unions provide small personal loans at low interest rates. You may also consider a cash advance from your employer or taking advantage of overdraft protection on your bank account, which typically costs less than a payday loan.

They’re fast

Payday loans provide instant access to funds for UT borrowers, even those with poor credit. But these short-term loans come with high interest rates and fees, making them a costly form of borrowing.

Typically, borrowers visit payday lenders, which also function as pawn shops, to receive a small cash advance based on a personal check held for future deposit or electronic access to the borrower’s bank account. On the due date, the lender cashes or redeems the check and deducts the loan and fee from the borrower’s next paycheck.

These loans have a short repayment period and high costs, which can lead to a debt cycle in which borrowers take out new payday loans to repay the old ones. To avoid the trap of payday loans, consider contacting a non-profit credit counselor. Many agencies offer free or low-cost credit counseling for borrowers in need. Credit card companies and other lenders also might be willing to work with you on a payment plan, which could obviate the need for payday loans.

They’re affordable

Payday loans are short-term debts that must be paid back on or before your next payday. They typically carry fees that equate to triple-digit interest rates and can trap you in a cycle of debt.

Many people use payday loans to cover recurring expenses, such as utilities or rent. Unfortunately, the majority of these loans are not paid off in the two-week repayment window and must be rolled over or replaced with another loan, adding to your debt.

A better alternative to payday loans is a personal loan, which can be obtained from banks and credit unions. The rate and fees vary depending on the lender, but can be much lower than those of a payday loan. You can also seek help from a financial counselor to find out how you can avoid payday loan debt. You may be able to negotiate with your creditors for a payment plan that reduces your monthly payments. Alternatively, you can try to find a debt consolidation program to combine your payday loans and other types of debt into one low-cost payment.

They’re regulated

There are strict rules on payday lenders and you should always check that they’re regulated by the Financial Conduct Authority. You should also shop around for the best deal and avoid using credit brokers that charge a fee before they help you find a lender.

In states that allow payday lending, there are many different laws that govern the fees and rates. Some state laws prohibit payday loans altogether, while others limit the maximum annual percentage rate to 36% and restrict the amount of money a borrower can pay back in one month.

The Consumer Financial Protection Bureau has proposed changes that would require payday lenders to determine a person’s ability to repay before offering them a loan, and limit payments to 5% of a borrower’s income and loan durations to six months. These reforms could reduce costs for borrowers and help them move on to better-quality financial products.