How do $1,500 payday loans work?
A $1,500 payday loan is a loan that is likely to have a fast approval process and charge high fees. Depending on your circumstances, you might be able to receive the money within an hour.
However, if you want the lender to give you the money almost instantly, and without conducting an in-depth credit assessment, you’ll have to pay for the privilege. The lender can charge you a one-off establishment fee of up to 20 per cent (which would be $300 for a $1,500 payday loan) and a monthly account-keeping fee of up to 4 per cent (or $60). Payday lenders can only charge fees – not interest.
Should I take out a payday loan?
As a general rule, you should take out a payday loan only if there are no other options. That’s because payday loans are usually very expensive.
Payday lenders can’t charge interest – they can only charge fees. But the fees can be steep, so your borrowing costs might be equivalent to paying an interest rate of more than 500 per cent.
How much does a payday loan cost?
Payday lenders can’t charge interest on payday loans. But you might be charged these fees:
- A one-off establishment fee of up to 20 per cent of the loan
- A monthly account-keeping fee of up to 4 per cent of the loan
- A government fee
- A penalty fee (if you default on the loan)
For example, imagine you took out a $1,500 payday loan with a 12-month loan term and fortnightly repayments. Here’s how much you might be charged:
- An establishment fee of $300
- An account-keeping fee of $60 per month (or $720 over 12 months)
As a result, your repayments would be:
- $96.92 per fortnight
- $2,520 in total (equivalent to an interest rate of 68 per cent per annum)
What's the interest on a $1,000 payday loan?
Payday lenders aren’t allowed to charge interest on $1,000 payday loans (or any other payday loans). However, they are allowed to charge high fees, which may include:
- An establishment fee of up to 20 per cent (or $200)
- Monthly fees of up to 4 per cent (or $40)
Depending on the length of your loan, here is the maximum amount you would have to repay with a $1,000 payday loan:
- 1 month = $1,240
- 2 months = $1,280
- 3 months = $1,320
- 4 months = $1,360
- 5 months = $1,400
- 6 months = $1,440
- 7 months = $1,480
- 8 months = $1,520
- 9 months = $1,560
- 10 months = $1,600
- 11 months = $1,640
- 12 months = $1,680
How do I get a $500 payday loan?
The most common way to get a $500 payday loan is over the internet, although some lenders also take in-store applications. The application process may take as little as five minutes and, in some cases, your loan may be assessed and approved within the hour.
When you apply for a $500 payday loan, you will probably have to provide:
- Name and address
- Proof of identification
- Employment details
Do I need security for instant approval loans?
As a general rule, you don’t need to provide security to get an instant approval loan. However, in return for giving you a quick loan and not asking for any collateral, the lender will almost certainly charge you high fees.
With instant approval loans, the lender can charge an establishment fee of up to 20 per cent (which would be $300 on a $1,500 loan) and a monthly fee of up to 4 per cent ($60 on a $1,500 loan).
Should I take out a $1,000 payday loan?
As a general rule, you should think very carefully before you take out a $1,000 payday loan – and proceed only if you’ve explored all other options. That’s because payday loans generally have very high fees.
How fast can I get a $1,500 payday loan?
Some lenders will assess $1,500 payday loan applications and then pay out funds within an hour.
However, each lender is different. Also, assessment times vary from borrower to borrower. Some $1,500 payday loan applications are simpler and can therefore be approved faster; others are more complicated and take longer.