Apply for Safe Payday Loans – Avoid Loan Sharks

Most borrowers in need of instant cash advance think of applying for a short-term Payday Loan online from a lender that does no credit check. Of course, such loans are fast and easy but, on the other hand, may be risky if you have chosen the wrong company.

To make your borrowing experience safe, just make sure to be responsible and careful selecting the lending organization.

Study the laws and regulations concerning short-term credit. Check if it’s legal in your state and whether the lender operates according to the rules.

Payday Loans and How They Work

A payday loan is a type of short-term loan that is typically repaid on the borrower’s next payday.

  1. The borrower gives the lender a pay stub as proof of income and tells them how much they want to borrow.
  2. The lender then provides the borrower with a loan for that amount, plus any fees associated with the loan.
  3. The repayment period is typically based on how frequently the borrower gets paid, i.e. weekly, biweekly or monthly.
  4. In addition to employment verification and a pay stub, most lenders will also require bank account information in order to approve a payday loan.
  5. Once approved, the loan is typically deposited into the borrower’s bank account within a few hours.
  6. On the date the loan comes due, the borrower is responsible for repaying the full amount of the loan, plus any additional fees that may have accrued. If the borrower is unable to repay the loan in full, they may be able to extend the loan or roll it over into a new loan, although this usually entails paying additional fees.

What happens if you don’t pay a loan shark? They may use collection agencies to claim the debt. They can even sue you to court and demand the money in a court case.

Risks of Easy Money Payday Loans

No doubt, Payday loans are quick, easy and convenient. However, they often lead to debt as have triple-digit interest rates. We also need to take into account the fact that people who apply for a payday loan are usually low-income with no regular job and no emergency cash for everyday expenses.

The major risks that come along with online payday loans are:

  • Guaranteed loan sharks. What is a loan shark? It’s a lender who promises 100% approval with no credit check for bad credit applicants with same day financing. Their offers look too good to be true. And in most cases, they hide excessive interest rates and penalty fees.
  • Very high interest rates and other finance charges. The APR on Payday Loans can reach 1250% which makes them really costly. Besides, you are likely to be charged extra fees such as $7 per day for late payment, verification fees, origination fees, etc.
  • Repayments with the help of direct debit from your bank account. You may be left with no money for recurring expenses.
  • Constant loan rollovers and renewals to pay off the previous debt.
  • Negative impact on your credit score. Numerous loan requests and even worse – loan defaults – van damage your credit history and make the score lower.
  • You get into a debt cycle hard to escape.
  • Penalty fees and collection practices in case of loan default.  Debt collectors can use unstoppable phone calls and even court cases.
  • Unsuitable for large expenses. Payday Loans come in small amounts up to $1,000 which won’t be enough for serious purchases.

Are Payday Loans Legal in All States?

32 US states allow their residents to take out payday loans with no regulations on interest rates.

Payday loans as short-term loans are allowed in 27 states:




















North Dakota



Rhode Island

South Carolina








Which States Prohibit Payday Loans?

Currently, 8 states find short-term loans illegal and forbid this type of cash loans. Lenders are forbidden to offer Payday Loans to borrowers from:

·         Arkansas

·         Connecticut

·         New Hampshire

·         New York

·         Minnesota

·         South Dakota

·         Vermont

·         West Virginia

How Payday Loan Rates and Terms are Restricted

The other states try to regulate short-term financing by interest rate restrictions. Most of them  limit the APR to 36%. These places are:


New Jersey




North Carolina





District of Columbia



New Mexico

For example, in Arizona maximum interest rates on loans smaller than $3,000 in amount are capped to 36% APR. Similar situation is in Virginia – they allow loans up to $2,500 with 2 year repayment term at the rate of 36%.

Arizona Payday Loan Laws and Regulations

Before 2010, short-term loans were legal in Arizona. It was allowed to borrow up to $500 for a 5-day term at 459% APR.

Nowadays, the state has imposed rather strict regulations on small payday loans. The law determines them as forbidden, though it’s more correct to say that lenders are banned from offering loans at the interest rates higher than 36% APR. It means – not all short-term loans are prohibited, only those which are higher than $3,000 in amount and have APR over 36 per cent.

Besides, there’re other payday loan alternatives in Arizona. The residents can apply for $1,000 – $5,000 Installment Loans and pay the money back within 1 year.

When you decide to take out a Payday Loan due to its attractive interest under 36%, make sure to include other fees such as NSF fees, late payment fees, etc. They can make the total cost rather expensive.

When you need emergency cash in Arizona, consider numerous programs from non-profit organizations such as Low Income Energy Assistance Program (LIEAP), Arizona Health Care Cost Containment System (AHCCCS), Child Care Assistance, and others.

Also, read all the fine prints in the documents, make a plan how you are going to repay the loan and only then submit the application.

How to Find a Trusted Lender with Safe Payday Loans

The main rule in payday loan borrowing is to find a legitimate lender that is legally licensed to offer short-term loans in your state.

Check if they have a state-issued licence easily found on their website. Pay attention to huge lending platforms that have their own trusted partners, with company reviews, customer reviews, physical location and contact number to let you ask any questions or solve your problems. For example, is a great sample of such services that lets you compare numerous lending companies, offers their ratings, a list of addresses as well as the chance to complete the application form online.


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