Payday Loans in Minnesota

Explore our list of payday loan providers in Minnesota. Whether you're looking for $255 payday loans online, same-day options, or no credit check loans in MN, we provide detailed information to assist your decision. Learn about the regulations, limits, and most reliable online payday loans in Minnesota.

A payday loan is a short-term loan typically taken out to cover unexpected expenses or bridge the gap between paychecks. In Minnesota, payday loans are regulated by state law and are subject to specific limitations and restrictions.

Under Minnesota law, payday loans are defined as loans of $350 or less that are typically due on the borrower's next payday. The maximum amount that can be borrowed is $350, and the average APR charged on a payday loan in Minnesota is 200%. However, during a committee hearing in February 2023, state lawmakers discussed a bill (HF290) that would limit the interest rates charged by payday lenders to 36%. If passed, this would bring Minnesota in line with 18 other states that have similar caps, while 12 other states have banned payday lenders altogether.

Minnesota law also requires payday lenders to be licensed by the state and to follow certain regulations when making loans. For example, lenders must disclose all fees and charges associated with the loan and provide borrowers with a written agreement outlining the loan terms.

Payday Loans in Minnesota

What is the Payday Loan Limit in Minnesota?

In Minnesota, the maximum amount that a borrower can take out through a payday loan is $350. This is the highest amount that lenders are allowed to offer in the state, and borrowers cannot take out more than this limit. Also, lenders must assess a borrower's ability to repay the loan. The APR for a 14-day $100 loan is 391%.

How To Borrow?

Apply for a loan

Find a licensed lender. To obtain a payday loan in Minnesota, you must first find a lender who is licensed to operate in the state. You can search for licensed payday lenders online or by visiting a physical storefront.
Submit an application and provide the required information. Once you have identified a lender, you will need to provide them with some basic information to apply for the loan. This may include your name, address, phone number, social security number, and proof of income.
Get approved. The lender will then assess your ability to repay the loan based on your income and other factors and determine the maximum loan amount that you are eligible for. If you are approved for the loan, you will typically receive the funds as a direct deposit into your bank account within one to two business days.

It's important to carefully read and understand the terms and conditions of the loan before accepting it, including the interest rate, fees, and repayment terms. Be sure to ask any questions you may have before signing the loan agreement.

Pros and Cons

Pros

Fast cash. Payday loans can provide quick cash within one or two business days.

Easy application. Applying for payday loans is usually simple and requires less documentation than other loans.

Convenient. Payday lenders can be found online or in person, making them convenient.

Rollovers are not allowed. Borrowers cannot extend the term of their initial loan by simply paying additional fees or taking out a new loan to cover the original amount.

Cons

High costs. Payday loans are expensive due to high-interest rates and fees, even though Minnesota plans to limit the interest rate to 36%.

Short repayment terms. Borrowers have to pay off payday loans on their next payday, which can be difficult and lead to a debt cycle.

Risk of predatory lending. Some payday lenders may charge exorbitant fees or offer loans to borrowers who can't repay them. It's important to read loan terms carefully to avoid being exploited.

Adverse credit effects. Payday loans may not affect credit scores positively, and defaulting on them can negatively affect credit history.

Requirements

Be at least 18 years old. Borrowers must be at least 18 years old to be eligible for a payday loan.
Have a regular source of income. Borrowers must have a steady source of income, such as a job or government benefits, to demonstrate their ability to repay the loan.
Have an active bank account. Borrowers must have an active bank account in their name, as the loan proceeds are typically deposited directly into the borrower's account, and repayments are typically withdrawn from the account.
Provide identification and contact information. Borrowers must provide valid identification, such as a driver's license or state ID, and contact information, such as a phone number and email address.
Meet other lender-specific requirements. Some lenders may have additional requirements, such as a minimum credit score or a maximum debt-to-income ratio.

Interest Rates

Minnesota's law limits payday loans to a maximum of $350, with a maximum loan term of 30 days. The finance charges vary depending on the amount of the loan, ranging from $5.5 for loans up to $50 to 6% (minimum $17.5) plus $5 for loans from $250 to $350. The real APR is 200%. Rollovers are not allowed, and criminal actions against borrowers are prohibited.

Furthermore, in February 2023, state lawmakers discussed a bill (HF290) that would cap interest rates for payday lenders at 36%. If the bill passes, Minnesota would join 18 other states with similar caps, while 12 other states have outright bans on payday lenders.

Lenders in Minnesota

CashCentral is a financial services company that offers payday loans and installment loans. Cash Central aims to provide fast cash solutions through either payday or installment loans, which can be requested online. These types of loans are generally designed to be short-term solutions for emergency financial needs.
ACE Cash Express is a national lender that offers payday loans, installment loans, and other financial services online and at physical storefronts.
One Main Financial is a traditional lender that offers personal loans at physical branches. They have several locations throughout Minnesota and may offer loans for emergencies or unexpected expenses.

Alternatives

Personal loans. These are loans that are not secured and can be used for different purposes, including emergency expenses. Personal loans tend to have lower interest rates and longer repayment terms compared to payday loans.
Credit cards. Credit cards are a practical option for handling unforeseen costs as they provide a revolving line of credit. Credit cards have varying interest rates, but borrowers who pay off their balances each month can avoid interest charges.
Installment loans. These loans are paid back in a series of scheduled payments over a specified time. They can be used for different purposes, including emergency expenses. Compared to payday loans, installment loans tend to have better terms.
Emergency assistance programs. Emergency assistance programs are available in Minnesota to provide financial aid to individuals and families facing tough times. These programs can offer support with expenses related to housing, utilities, food, and other essential needs.

Payday Loans Legal Regulations in Minnesota

Loan limits. The maximum amount that can be borrowed in a payday loan is $350.
Interest rates. The APR for a 14-day $100 loan is 391%.
Loan terms. The maximum loan term is 30 days.
Fees. Lenders can charge a fee for payday loans based on the loan amount. For loans up to $50, the fee is $5.50; for loans from $50 to $100, the fee is 10% plus $5; for loans from $100 to $250, the fee is 7% plus $5; and for loans from $250 to $350, the fee is 6% plus $5.
Rollovers. Lenders are not allowed to offer rollovers or extensions to borrowers.
Licensing. Payday lenders must be licensed by the Minnesota Department of Commerce to operate in the state.
Consumer protections. Minnesota law prohibits payday lenders from using abusive or deceptive practices, such as threatening borrowers with criminal action or charging excessive fees.

Important

Keeping your Debt-to-Income (DTI) ratio below 30-40% of your monthly income is crucial. This will help you avoid potential financial problems in the future. Additionally, always assess the necessity and feasibility of taking a loan, ensuring you can comfortably manage its repayment.

How to Choose a Lender

Make sure to confirm whether the lender is licensed to operate in your state. You can verify this information with your state regulator or attorney general.
Check if the lender is a member of a reputable association, such as the Community Financial Services Association of America. Membership in such organizations may provide an extra level of reliability.
Carefully review all the terms and conditions of your payday loan contract.
Thoroughly examine the interest rates on payday loans and ensure that your contract includes a detailed breakdown of the total cost of the loan.
Take advantage of your right of rescission. Usually, you can rescind the loan within three days after signing the agreement. Alternatively, there is typically a "cooling-off" period, which allows you several days to thoroughly review the contract before making an informed decision to enter into a consumer loan agreement based on the terms specified by the lender.
Choosing a payday lender is a significant decision that demands careful consideration and a good understanding of how such organizations operate.

Other Loans

FAQ

Yes, online payday loans are legal in Minnesota. However, the same regulations that apply to payday loans offered at physical storefronts also apply to online lenders. This means that online payday lenders must comply with the maximum loan amounts, interest rates, and other regulations established by Minnesota law.

It's important for borrowers to ensure that any online payday lender operating in Minnesota is licensed to do so in the state and follows all applicable state and federal regulations. Additionally, borrowers should carefully review the fees and interest rates associated with the loans before agreeing to the loan terms.

Despite being legal, payday loans can be costly and may lead to a cycle of debt if not repaid on time. Borrowers in Minnesota should explore other options for borrowing money, such as personal loans or credit cards, and should carefully consider the costs and risks associated with any type of borrowing before agreeing to loan terms.

According to Minnesota law, a borrower is limited to a maximum of one outstanding payday loan at a time. Additionally, a borrower cannot use a loan from one lender to repay a loan from the same lender. In total, a single lender can only lend a maximum of $350 in principle among all loans to a borrower. This regulation is designed to prevent borrowers from taking out multiple payday loans and falling into a cycle of debt.

Furthermore, Minnesota law prohibits payday lenders from offering rollovers or extensions to borrowers, which means that borrowers cannot extend their loan term by paying additional fees or interest charges. This is another measure in place to protect borrowers from getting trapped in a cycle of debt.

To apply for a payday loan in Minnesota, borrowers typically need to provide the following information:

Identification: Borrowers must provide a government-issued ID, such as a driver's license or passport.
Proof of income: Lenders require proof of income to ensure that borrowers can repay the loan. This may include recent pay stubs, bank statements, or other documentation of income.
Bank account information: Borrowers must have an active checking account to be eligible for a payday loan. Lenders may require borrowers to provide bank account information, such as their account number and routing number.
Contact information: Borrowers must provide contact information, such as a phone number and email address, so lenders can communicate with them about the loan.

It's important for borrowers to carefully review the terms and fees associated with a payday loan before agreeing to the loan. Additionally, borrowers should ensure that the lender is licensed to operate in Minnesota and follows all applicable state and federal regulations.

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