|
Payday loans are small cash advances, usually of $500 or less. To get a loan, a borrower gives a payday lender a postdated personal check or an authorization for automatic withdrawal from the borrower’s bank account. In return, he receives cash, minus the lender's fees. For example, with a $300 payday loan, a consumer might pay $45 in fees and get $255 in cash.
To get a payday loan, most consumers only need to show personal identification, have a personal checking account, and provide proof of income from employment or government benefits, such as Social Security or disability payments. Unlike conventional lenders, payday lenders do not look at a borrower's monthly expenses or her ability to repay the requested loan.
|
