Every year, as many as twelve million Americans take out a payday loan. If you are considering a payday loan, then you need to find a reputable lender.
This will ensure that you only take out safe payday loans. With safe lenders, you can ensure you get the financial help you need.
Use these six tips to ensure you find a reputable lender.
1. BBB Accreditation
The Better Business Bureau is a nonprofit organization that helps consumers identify legitimate businesses. They can help mediate when there is a disagreement between companies and their customers.
Our take:Lender focused on poor credit, based out of Chicago currently offering loans in 29 statesAPPLY NOWLender: OppLoansCredit ScoreLoan Size/AmountLoan TermAPROrigination Fee350 – 600$500 – $5,0009 – 2459.00% – 199.00%0.00% – 3.00%
Check out a potential lender and find out what score the BBB has given them. You can also see how many complaints are filed against them and how responsive the lender was to resolve those issues.
While you are researching a lender, look at their industry reputation. Do they appear on top lender lists? Do they have good online reviews?
2. Contact Information
How easy is it to find the lender’s contact information? If all they have is a contact form, you’ll want to see how responsive they are before you agree to a loan.
Keep in mind that legitimate lenders don’t have a problem sharing their physical address, email, or phone number. You should be able to determine where the company is based out of even if they operate mainly online.
Lenders that operate legally are required to be transparent about their terms and fees. Your loan contract should clearly outline all of the fees you are expected to pay throughout the course of your loan.
4. State Regulations
Lookup what the state regulations and limits are for the fees a lender may charge. Then check to make sure your chosen lender abides by your state’s regulations. If they do, then you know they are operating legally.
Our take:Online marketplace to find you a personal loan offer that matches your needsAPPLY NOWCredit ScoreLoan Size/AmountLoan TermAPROrigination FeeAll can apply$100 – $15,0001 – 604.99% – 1,386%Varies by lender
5. No Use Restrictions
A legitimate lender will not put use restrictions on your loan money. The only limitation that is normal is not to use the money for illegal purposes. If a lender tries to dictate how you use the money, then they may not be trustworthy.
6. No Money up Front
No reputable lender will ask for money upfront. If a potential lender asks you to pay them upfront, then this is a huge red flag.
Reputable lenders will charge origination fees. But these are paid out of the loan proceeds.
Never pay money out of pocket before you borrow money.
Only Agree to Safe Payday Loans
If you need a payday loan, then you need to use these six tips to ensure you only take out safe payday loans. Reputable lenders will abide by state regulations and be transparent about their policies.
Look for a company that has a positive industry reputation and a history of providing quality customer service.
Now that you know how to find a reputable lender learn the five steps to getting a payday loan.