What are payday loans?
Payday loans are loans of up to $2,000. Loan terms are generally between 16 days and 12 months, although they can sometimes be longer. Payday loans usually have these three characteristics:
- Borrowers need money in a hurry
- Applications are assessed rapidly
- Loans are expensive (high fees)
How long do you have to repay a $1,200 payday loan?
Depending on the lender, you’ll generally be given between 16 days and 12 months to repay a $1,200 payday loan.
As a general rule, the longer your loan term, the more the loan will ultimately cost you, because most payday lenders charge monthly account-keeping fees.
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 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)
Where can I get a $1,000 payday loan?
Australia has several dozen lenders that offer $1,000 payday loans. These payday loan providers tend to be smaller, lesser-known non-bank lenders rather than well-known big banks. Generally, they’re online-only businesses, which means you’d have to apply for your $1,000 payday loan over the internet. However, there are some payday lenders that also allow in-store applications.
Why do people use no credit check loans?
People use no credit check loans when they have bad credit and need money in a hurry.
Most lenders steer clear of no credit check loans, because they believe it’s too risky to lend to people with a bad credit score. However, some payday lenders are prepared to issue no credit check loans.
A word of warning – no credit check loans generally come with high fees. Payday lenders can’t charge interest, but they are allowed to charge an establishment fee of up to 20 per cent of the loan amount and a monthly fee of up to 4 per cent of the loan amount.
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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.
Is it hard to get a no credit check loan?
Not many lenders offer no credit check loans – but if you find one that does, the application process is quite easy. Here’s how it works:
- Find an online lender that offers no credit check loans
- Decide how much you want to borrow, and for how long
- Provide information about your identity, income and employment
In the best-case scenario, it might take less than an hour for the lender to assess your application, approve it and then transfer the funds.