Prepaid Debit Card Payday Loans: All Credit Types
If you are in a situation that requires cash quickly, a short-term loan with a pre-paid debit card can be a good option. Gone are the days of bank visits and lengthy loan processes. Borrowers can now quickly access cash online with relative ease.
Learn more about prepaid debit card loans and how to get approved.
*Warning about borrowing – the cost associated with small loans can be high and may not solve your money problems. Consider alternative financial help for common borrowing situations: help with bills, help with rent, help with debt or speak to a Community Action Agency to discuss financial assistance options.
How do debit card payday loans work?
These loans work like a line of credit or a prepaid credit card. Regardless of whether you apply online or in a store, you have the option of getting a prepaid debit card with the loan. When approved, your lender transfers your funds directly to your loan account. You then use your debit card to gain access to your funds.
Since the majority of cards come equipped with the MasterCard or Visa logo, you can use your card almost anywhere. You can even withdraw cash from an ATM (at a high rate though, so be aware).
State regulations determine how much money you can receive and the length of time for the loan. Remember, not all states can offer payday loans, if you live in such a location; there are alternative finance products to consider.
Compare debit card payday loans before applying
To avoid applying with an un-reputable lender, it is import to spend a bit of time reviewing potential lenders – it only takes 5 minutes and can save you time and money
- Check online reviews of the business
- Check for online complaints of the business
- Make sure the business is registered and licensed in your state
- Once you have narrowed down your choices – compare terms and costs
What are the features associated with using your debit card for your payday loan?
Some of the features associated with using your debit card are:
- You get to access your funds right away. As soon as the funds have been transferred, you can access your money. Use it at an ATM, store, online or over the phone. In certain circumstances you may receive your funds in as little as a few hours.
- Receive additional monies on your card. With certain cards, you can top them up with cash flow from other income sources. This lets you put all of your money onto one convenient payment card, so you don’t have to worry about keeping track of multiple accounts.
- Earn rewards. Depending on what card you choose, some offer rewards as well. Some offer discounts such as $10 off in certain store, while others will offer a reward for spending so much in a certain amount of time. Each card has different options, so make sure to check into that before settling on a card.
- Credit flexibility. As the cards are tied to credit facilities such as Visa or Mastercard, you can use the card to secure items that require a credit. Situations such as booking a hotel, a rental car or any other circumstance that requires a credit card to be filed.
What are the pros and cons of payday loans?
- Bad credit accepted. Provided you can show the lender that you can repay your loan, you should be able to get the loan approved. Regardless of whether your credit score is 400 or 800, payday lenders look at repayment capacity – your ability to service a loan. Learn more about no credit check loan options here.
- You can access your money quickly. Depending on the lender you choose, some are able to send funds through that same day. If you use the same lender again, the process will be even faster because you have already used them and have the debit card available. Since the money is applied right to the card, you don’t have to wait for a check to come in the mail or process through your bank account, thus cutting down on the length of processing time.
- You don’t need a bank account. There are plenty of lenders who will approve your loan without needing a bank account to do so. This is huge benefit for those who might not have a bank account, or simply don’t want to mess with getting one in the first place.
- Improve your credit. If you have poor credit, this is one way to obtain credit and slowly show lenders you have the ability to borrow and make repayments without default.
- Fees. The fees charged for a payday loan are considerably higher than if you were to go out and get a conventional loan. Unfortunately, this is the cost of not having the credit you need to get the better loans.
- Faster repayment required. With a payday loan, you will often have to pay it off the next time you get paid. Make sure you are able to afford to do so before wasting your time applying. If you aren’t able to pay it off the next time you get paid from your employer, you might need to reevaluate if this loan option is going to work for you.
What do you need to know about payday loans?
Before applying, think about how you are going to repay your loan. If you don’t think you are going to be able to pay it off when it comes due, you might want to rethink your options. If you don’t end up paying the loan on time, you could pay far more in fees and additional charges than you bargained for. It could also end up affecting your credit.
Find out if the lender has a valid license and can lend money to those in your state. Not all lenders are able to operate in all states, so you need to check into this first. Check out all of their terms and conditions before you agree to the terms of their contract. You don’t want to sign something and end up finding out that you cannot abide to them after the fact.
What are some of the common questions asked about debit card payday loans?
How much time is involved in applying for debit card payday loans?
As long as you have all of your information handy, you should be able to complete the app in just 10-15 minutes. Gather information such as; personal details (driver’s license), employer information, bank account information and how much you make (pay frequency).
Who is eligible to apply for payday loans?
As long as you are a permanent resident of the United States and you have steady income, you are eligible to apply. Borrowers collecting government benefits or social security can also be approved if these benefits aren’t their sole source of income. You also have to be of legal age, which is typically 18 in most states.
Are there other options beyond payday loans when they aren’t eligible in my state?
There are numerous other loan products with pre-paid debit cards available. Check with your bank or credit union for salary advance loans, checking/saving account loans or stretch pay loans.
Are debit card payday loans safe?
Over the years, short-term loans have been under the microscope of government regulators due to predatory lending. This has changed the industry to protect borrowers and push responsible lending. Always check for online complaints and reviews of any company along with their business license.
ALTERNATIVE short-term loans to consider
Whilst payday loans are convenient and come packed with features, they are expensive. Learn about competitive small loans that banks and credit unions provide, created specifically as alternatives to pay day loans.
Stretch Pay Loans: Small loans with low fees and interest rates; loan amounts up to $1000
Checking/Saving Account Loans
Salary Advance Loans: Small lower interest loans provided by many credit unions, loan amounts up to $500