Quick Loans of March 2023

The most popular way to get access to extra funds is traditional personal loans. However, a personal bank loan is not always an option for you when you need money urgently. You go to a bank, apply, and wait for approval to obtain it. It might take up to seven business days from your application to your loan agreement — and the moment when you get your funds. So, it’s doubtful that you will end up with cash the same day. You can opt for quick personal loans via private lenders as an alternative. As the name suggests, their main feature is that you can borrow them almost immediately. Let’s look at various quick loans and straighten out their ins and outs.

Quick loans: what are they

Like all personal loans, quick loans can be unsecured or collateral.

• An unsecured loanis a loan that doesn’t imply any collateral. In other words, you borrow money and don’t provide a lender with any financial assurance.
• A securedorcollateral loanmeans that you pledge some asset to your borrower. It can be your car, house, jewelry, etc. If you fail to pay the debt after a time set by your loan agreement, a lender has the right to seize your asset.

Both types of quick loans have several things in common, and such things are the main reasons to opt for this type of loan despite its possible risks and cons. Here are the primary aspects of quick loans:

1. Fast approval and funding. Most fast loan lenders are willing to consider an application and give their verdict on the same day you applied. Some of them can even give out the requested cash immediately after. There are options of same-day approval and next-day/same-day funding, or it may take a couple of days. Still, it’s quicker than a procedure required by traditional banks, which may last up to a week.
2. No hard credit check. When applying for a personal loan via an online lender or in-store lender, you need to prove you have a good credit history. If it’s far from the truth and your credit score is not good, your application has all chances to be denied. Fast loans organizations are often willing to serve borrowers with a bad or empty credit history. Theyperform a soft credit check to ensure a borrower has a stable income. A soft credit check doesn't appear in your credit reports and won't prevent you from getting personal loans or mortgages in the future.
3. Small money for a short period. Some personal loans allow you to pay off a particular quantity monthly within several months or years. However, quick loan options imply you need to return the funds pretty shortly — usually, no later than after four weeks.
4. Relatively high interest rates. Compared to credit cards, quick loans come with a higher interest. For instance, a median credit card annual percentage rate is approximately 20%, while a fast loan can come with a 390% interest or more.

The major types of quick loans

There are several variants of quick loans. Their terms and conditions vary from state to state, and some US regions entirely prohibit some forms of emergency funding. Let’s give a closer look at the most common options.

Payday loans

Payday loans (fast cash loans, fast personal loans, paycheck loans, instant loans) are short-term unsecured loans for small amounts (about $500 on average) that you usually need to repay on your next paycheck day. It works like that: you have unexpected expenses, like car repairs. You come to a payday loans organization office or find a lender online and grab some money that you need to repay at once as soon as you get your salary. Unlike standard personal loans that usually come in installment loans, you need to pay the total amount once your loan terms are over when you provide monthly loan payments.

Usually, you can apply and obtain cash loan funds on the same day, within several hours. To repay, you can authorize your lender to charge your debit card. When the payday comes, they remove your loan amount plus the interest fee from your account. If you can’t make payment on the due date for some reason, you can usually ask for a rollover— extra time for repayment.

Payday loans regulations in different states

One of the things that may prevent you from obtaining a payday loan is your residence address. Not all states grant licenses to payday lenders. Besides, loan amount and period also differ depending on the region. For instance, you can borrow up to $1,000 in Ohio, while Californian lenders are not allowed to grant more than $500. The loan term can’t exceed 30 days in most states, but there are some exceptions: 60 days in Kentucky. Payday loan interests also vary. If your home state prohibits payday loans, you still can’t obtain them in another state.

Even if your state regulations approve payday loans, no lender in the other states will accept your request, as the lending terms differ. You can only apply for a payday loan in your home state if your state authorities made it legal to license such loan lenders. According to the National Conference of State Legislatures, payday loans are allowed in the following states: Alabama, Alaska, California, Colorado, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Lousiana, Maine, Michigan, Minnesota, Missisipi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, Wyoming.

How to qualify for a quick loan?

Requirements may differ at various organizations. However, most lenders keep them very basic, allowing almost anyone to apply. The standard requirements are the following:

• You must be at least 18 years old;
• You must hold a valid ID;
• You must have an active bank account so that a lender can charge your debt;
• You must have at least $1,000 of income per month after tax deduction. However, some lenders can do without such evidence but will likely offer higher rates.

How to apply for a payday loan?

You can choose three possible options to apply for a loan:

1. Visit a lender’s office nearby;
2. Apply online via the lender’s Internet web-page, and come to an office after the approval;
3. Send a form via an aggregator site, and receive offers from various online lenders. A form you need to complete usually consists of three parts:
   1. Your personal details (name, ID number, address, etc.);
   2. Your employment details (gross income, employment period, pay periods, the next pay date, etc.);
   3. Your financial information (your bank account type, ABA/Routing Number, how long you have had your account).

Payday loans interest rates and fees

As we have already mentioned, loan amounts and interest rates vary depending on the state. A fee is usually counted for every $100 you borrow, and its average amount is $15.

So, if you decide to borrow $500, you will need to pay $15 five times. On your payment due date, you will need to repay $500 (the loan's principal) and $75 of the loan interest. The APR of this loan will depend on its term. For instance, if it were 14 days, the APR would be 391.07%. If you request a rollover, you will need to pay more than $75 within the next 14 days. The whole debt amount will rise to $650. The terms might differ depending on the state's financial institution and local regulations.

Payday alternative loans

Payday alternative loans are issued by federal credit unions — non-commercial financial cooperatives that provide services exclusively to their members. They often have lower interest rates and less strict repayment terms, and such a loan may vary from $200 to $1,000.

Unlike a standard payday loan, the one from a credit union can not be a subject of a rollover. Besides, it’s possible to obtain such a loan in an installment loan when you repay in small amounts within several months. Some payday alternative loans can reach twelve months in repayment terms. Besides, some unions offer bonuses for on-time repayment. Payday alternative loans regulations in different states. As a credit union provides such a loan, there are no particular restrictions. You can apply in any state where you can sign up for union membership.

How to apply and qualify for a payday alternative loan?

First, you need to be a part of a credit union. It implies paying a certain entrance fee and having a savings account. Some unions only accept business organizations as members, but there is a range of unions available for almost any individual. Some unions require that you be a member for at least a month. The others borrow money as soon as you sign up for a membership. Credit unions don’t usually check your credit history and only require that you have a stable income: salary, alimony, or social security.

Interest rates and fees

Payday alternative loans' APR rate can’t exceed 28%, making it much more attractive than a standard payday loan. The rates might range from 4,99% to 28%, and loan amounts usually vary from $250 to $50,000.

Auto title loans

An auto title loan, or a car title loan, is a short-term quick loan that requires your car as collateral. The loan amount might differ from as small as $500to more serious sums of several thousand dollars. As this loan is secured, the lender has lower risks and thus doesn't usually check a credit score or many income proofs. You can obtain such a loan within twenty-four hours unless you need extra time to collect all papers.

Auto title loans regulations in different states

Car title loans are not available in all states. States where you can consider such an option have different caps, debt terms, and interest laws. Some states don’t limit the lenders regarding the loan amount, while others have pretty low limits. For instance, you can only borrow $2,000 as a car title loan in Tennessee, while the debt can’t exceed the car retail price in Idaho. The loan amount is up to the car’s value and may range between 25% to 50%of the automobile price. According to the Consumer Federation of America, car title loans are allowed in the following states: Alaska, Arizona, Delaware, Georgia, Indiana, Illinois, Missisipi, Missouri, Nevada, New Hampshire, New Mexico, Tennessee, Texas, Utah, Virginia, Wisconsin.

How to qualify for an auto title loan?

Most of the requirements are related to your collateral. Here are the most typical documents you need to qualify:

• Original vehicle title that shows you are the only car owner;
• Personal ID;
• Proof of residence;
• Vehicle registration;
• Car insurance;
• Proof of capacity to pay a debt: pay stub or alternative;
• Reference names and numbers.
• Vehicle keys (copy);
• GPS tracker attached to a car (not always requested).

How to apply for an auto title loan?

Like with the other loans, you can apply via the Internet to visit a lender’s store to request a loan. You can apply with an empty or bad credit history as the loan is secured.

Interest rates and fees

The average cost of the loan is $125 for every $500 you borrow, or a 300% annual interest rate. The cap might differ depending on a state and a particular lender, but such an option is the most typical one. Suppose you own a car with a market value of $2,000 and take a car title loan of $1,500. The interest rate is 243.33% per year, and the repayment term is 30 days.

Many car title lenders indicate a monthly rate to attract borrowers by lower figures. You can often come across an auto title loan offer promising a 20% or 30% interest rate. This rate is not annualized in most cases, so you need to multiply this amount by twelve to count the actual APR.

When the one-month term is over, you will need to repay $2,000 as the loan principal and the interest fee. A 243.33%APR is $100 for every $500 you borrowed. Thus, you need to repay an extra $650 by the end of the month. If required, you can opt for a rollover, which will add more than $650 if you ask for one more month to repay. Some lenders also include processing or origination fees and other additional commissions. Besides, you may need to obtain some paid documents for getting a loan — like a vehicle road service plan may cost from $5 to $100.

If you can’t cover the debt, a lender will seize your vehicle and become its rightful owner, with all rights to keep it or sell it. If your lender forced you to set a GPS tracker, such a device might disable your car remotely.

Personal installment loans

Installment loans mean that you borrow some money and repay it in equal sums every month. Such a loan might vary from six months to six years. Sometimes, a lender requires collateral to secure a loan, but many do without one — it mainly depends on the loan amount and purpose. It’s possible to opt for prepayment, and it means you repay the credit principal and interest before the loan term is over. However, it might imply extra prepayment fees.

Installment loans regulations in different states

Installment loans are available everywhere in the USA, and every state has its laws regarding interest rates, fees, and other loan terms.

How to apply for an installment loan?

Every lender has different requirements for a borrower, and many of them will accept your request even if you have a bad or thin credit history. Here are the most typical requirements for an installment loan:

• Proof of income: financial statements, cash flow proofs, etc.;
• Age: you must be 18 or over;
• Collateral: optional;
• Credit score: 630 for loans from $1,000 or lower for smaller amounts. Various lenders can apply different credit score rules.

How to apply for an installment loan?

To apply, you can visit a lender's office. However, most people opt for online lenders as a quicker and more convenient option.

Installment loans interest rates and fees

The APR might vary depending on a lender and your credit score. The annual percentage rate may vary from 5% to 600%, depending on various factors. So, if you borrow $20,000 for five years with a 5,99% interest, you will need to pay $387 every month. In total, you will repay $20,000 as a loan principal and $3,220 above as interest. The longer is the credit term, the more interest you pay in the end. For instance, if you borrow the same $20,000 for two years, the total interest will be $1,264.

Pawn shop loans

A pawnshop loan is another type of quick collateral loan. It typically works like that: you bring assets like jewelry, watches, precious stones and metals, firearms, clothing items, etc. A pawnbroker estimates your item’s resale value and decides on the loan amount. Usually, these loan amounts range between 40% and 70% of the item’s value. So, if you brought a golden ring that can be sold for $600, you can get a loan of $240 - $420.

Then you have from 30 to 90 days to pay the loan. Besides the loan principal, you pay an interest of about 2%-25% per month. If you can’t repay the loan, your golden ring goes to a lender so that they can sell it and compensate for the amount they gave to you.

Pawnshop loans regulations in different states

Pawnshops are allowed in all states but have different debt terms and interest rates regulations. Some states, like Massachusetts, have different laws for every city: for instance, pawn shops in Everett can’t charge more than 3% per month, while Chicopee has a limit of the 18% annual rate.

How to apply and qualify for a pawn shop loan?

A pawnshop loan doesn’t have any specific requirements. You need to bring something valuable that can be estimated and later sold if you don’t pay a debt.

Pawnshop loans interest rates and fees

The average rate varies from 2% to 25%. Such a loan doesn’t have any hidden fees, and the only thing you risk is your asset. So if your $600 golden ring stays at the shop for a month, and an owner gives you a loan of $300 under a 5% monthly interest, you will need to bring back $315. If you can't repay, you will lose $600 instead: your potential profit from selling the ring.

How to repay a quick loan?

Most lenders allow you to pay via several methods to opt for the most convenient one. All available methods are indicated in a loan agreement. The most popular options include the following:

• Cash. You visit a lender's office and pay in cash.
• Post-dated check. You provide a lender with a post-dated personal cheque when you sign a loan agreement.
• Online automated payments. You provide a lender with authorization to withdraw funds from your bank account, credit or debit card, or a credit union account. It is the most widespread option, mainly if you apply for a loan online.

What if you can’t repay a quick loan?

What if you don’t pay on time? Loan delinquency may not result in severe consequences: you will pay an additional fee or ask for a rollover in most cases. However, if you keep delaying a payout, you might face the following issues:

• Regular withdrawals from your bank account. A lender might keep trying to charge smaller amounts to get at least a part of the loan back. It brings upon bank fees for every transaction, including unsuccessful ones.
• Credit bureaus reports. Financial institutions can go further and send your case to a credit bureau. It might spoil your credit score and prevent you from getting personal or mortgage loans at lucrative rates in the future.
• Collection agencies. A lender might sell your debt to a third-party collection agency. It may hurt the credit history and cause more commissions and fees you will need to payout.
• Lawsuit. It’s unlikely that a lender will go to court if you owe such a small amount as $100 or so. However, it’s still a lender’s right, and if they decide to file a lawsuit, you will be obliged to pay or will be deducted some amounts from all sources of income. A collection can also sue you if they fail to obtain repayment from you.
• Vehicle or other assets forfeiture. If you take a title or a pawnshop loan, you can forfeit your goods to a lender if you can’t repay a debt.

Quick Loans Pros and Cons

To sum up, let’s overview the advantages and disadvantages of quick loans.

Pros

• Fast loan approval. The whole procedure may take from a couple of hours to 24 hours. It's convenient to cover unexpected expenses urgently.
• Fewer requirements. You can apply with a bad credit history, low credit scores, existing debts, or no paycheck confirmations.

Cons

• High interest rates. The rates might reach 500% or more, which is high compared to credit cards and personal loans.
• Possible loss of assets. Due to high rates, the risk of losing the collateral if you opt for a title loan becomes bigger.
• Not available everywhere. Some quick cash loans are prohibited in particular states by the Consumer Financial Protection Bureau.