Know the math
before you sign.

Take a typical lender charging $15 for every $100 borrowed. On a $500 loan, that's $75 in finance charges. You'd repay $575 in two weeks, which works out to 391% APR. Can't repay on time? After one rollover, you owe $650. After two, $725. The clock keeps running.

That works out to 391% APR over 14 days. Here's how the math runs: the $45 fee divided by $300 borrowed, multiplied by 365 divided by 14 days. APR looks scary mostly because the loan term is short. The shorter the loan, the higher the annualized number, even when the dollar charge stays the same.

Both numbers describe the same loan, but in different ways. The flat-rate fee tells you the actual dollar charge, usually quoted as $15 charged for every $100 you borrow. APR takes that fee and spreads it across a full year, so you can compare it to other loan products. Lenders prefer the flat-rate version because it sounds small. Federal law makes them show APR too, which is why you see 391% on the contract.

Hard to say without knowing which type. A payday loan at $15 for every $100 borrowed would cost you about $1,150 due in two weeks. A 12-month installment loan at 99% APR runs around $1,580 over the year. A personal loan at 24% APR over 36 months would come out near $1,420. Notice something weird: the loan with the lowest rate ends up the most expensive in total dollars, because you're paying interest for three years. Short term equals high APR. Long term equals high total cost. There's no escape from the math.

For small amounts like $200, payday is usually the worst choice. Apps that advance you wages you've already earned, like EarnIn or Dave, charge a buck or two per advance. Some employers will float you cash against your next paycheck for free if you ask. Credit unions offer something called a PAL loan, which is capped by federal rule at 28% APR. Brigit and similar subscription apps cost around $9 a month. Compare any of these against a $30 payday fee and the answer is obvious.

Sometimes, yes. Lenders usually accept Social Security, disability (SSDI or SSI), pension income, or unemployment benefits, as long as it's at least $1,000 a month landing in your account regularly via direct deposit. The one place lenders draw the line is unemployment benefits alone with nothing else. Those get declined more often than not.

Yes, and this surprises a lot of people. Short-term lenders barely glance at your FICO score. What they actually look at is whether your income is stable, how long your bank account has been open (thirty days is the usual minimum), and whether your paychecks hit by direct deposit on a regular cycle. A borrower with a 540 score and steady income usually gets approved. A borrower with a 720 score on a bank account opened last week often doesn't.

Yes, but be ready to send more paperwork than a W-2 worker would. Most lenders want to see three to six months of bank statements where deposits add up to at least a thousand bucks a month, fairly consistently. Money coming in through Venmo, PayPal, or even cash deposits into your checking account usually counts toward that.

Almost always no. Lenders pull payment through ACH debit from a real checking account, and prepaid cards don't play nice with that system. Easiest fix is to open a free account with Chime, Cash App, or Varo and wait about thirty days. After that, most lenders treat it as a normal checking account.

A few paths that actually work. Start by asking the lender for an extended payment plan. In many states they have to offer one if you ask, and it's usually free. If that doesn't help, look into a credit union PAL loan, which is capped at 28% APR under federal rules. The third option is free nonprofit credit counseling through NFCC.org. They negotiate with all your lenders at once, which beats trying to juggle it yourself.

Not on their own. A lender has to take you to court first and win a judgment before any garnishment is allowed. If that happens, federal law caps what they can pull at 25% of your disposable income. Several states go further and limit or outright ban wage garnishment for payday loan debt. One thing matters more than anything else: if you get a court summons, show up or respond in writing. Ignoring it guarantees the lender wins by default.

Usually goes like this. The lender keeps trying to debit your account, which racks up NSF fees from your bank. Then the account gets sent to collections, and if they report it, your credit takes a hit. If the amount is big enough, a lawsuit might follow. A court judgment can lead to wage garnishment or even bank account seizure. Defaulting is rarely the cheapest path. Call the lender first.

You have a federal right under the Electronic Fund Transfer Act to revoke ACH authorization in writing. The trick is sending the stop payment notice in two places at once: to your bank and separately to the lender. Do this at least three business days before the next scheduled debit, or it won't take effect in time. Heads up though, revoking the debit doesn't make the debt disappear. The lender just loses the ability to grab money straight out of your account.

Depends where you live. Around 32 states allow payday loans with various rules attached, while 18 states have effectively shut the product down by capping rates at roughly 36% APR. The state finder higher up on this page will tell you what applies where you are. If you find a lender offering payday loans in a state that bans them, two things are likely going on: they're operating outside the law, or they're claiming tribal sovereign immunity. Either way, walk away.

Anywhere from three to ten years, depending where you live. Once the time runs out, the lender loses the ability to take you to court over the debt, although nothing legally stops them from calling or sending letters asking you to pay. The trap to watch out for: making even a small partial payment, or putting anything in writing where you acknowledge the debt is yours, can restart the entire clock. Don't do either.

Legally messy. Tribal lenders argue they're protected by sovereign immunity, but the courts have been chipping away at that defense, especially when these lenders make loans to people who aren't tribal members. The CFPB and various state attorneys general have won cases against several tribal lenders in recent years. From a borrower's standpoint, the safer bet is to skip them entirely. Even where they operate legally, the consumer protections you'd have with a regular state-licensed lender often don't apply.

Three apps doing roughly the same thing, with very different pricing. EarnIn skips monthly fees and asks for an optional tip, with advances up to $750. Dave runs a dollar a month and caps advances around $500. Brigit charges close to ten bucks a month but includes auto-advance features that handle the timing for you. None of them charge APR since they're advancing wages you've already worked for. Pick based on how often you'd use it: rarely, EarnIn makes sense. Frequently, Brigit's monthly fee pays for itself. Somewhere in between, Dave fits.

Not even close, PAL wins by a mile. Federal rules cap the APR on a Payday Alternative Loan at 28%. Run the numbers on a $500 loan paid back over six months and the interest comes out to about $45. The same $500 borrowed as a payday loan and rolled over twice would cost $225 in fees alone, not counting the principal. Two catches to know about: you need to be a credit union member for at least thirty days before applying, and not every credit union actually offers PAL loans. The credit union locator on NCUA.gov is the fastest way to see what's available near you.

A handful of clear red flags. If they demand an upfront fee before "approving" you, that's a scam. Same with anyone "guaranteeing" approval without checking anything. No NMLS license number listed anywhere? Walk away. Pressure to sign in minutes is a tactic, not urgency. And nobody legitimate asks for your full SSN before showing any terms. Real lenders don't do these things.

Almost certainly a scam, yes. Legitimate lenders don't blast out unsolicited "pre-approval" emails with specific dollar amounts attached. The con usually plays out the same way every time: you respond to "accept" the offer, they come back asking for an upfront "insurance fee" or "processing payment" to release the funds, and once you pay it they vanish. The federal trade commission collects reports on this kind of thing at ReportFraud.ftc.gov.