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So, what is a payday loan direct lender? A direct lender is a lender that directly provides a consumer with a loan, rather than using a third party or broker. The downside to using a payday loan direct lender or payday stores is that if they declined your application, the lender who denied you won’t be able to suggest an alternative. This is because the only financial products available to them are their own. 

Alternatively, you can use a broker platform like Funding Zest that will connect you to various lenders, helping you find the best lender for you. The US is home to 23,000 payday lenders, who offer varying terms from one another, such as offering different interest rates and repayment terms. 


Key Points: 

  • A direct lender provides borrowers with loans themselves, rather than using a broker as a middleman.
  • Around 23,000 payday lenders operate in the US, with around 12 million Americans taking out loans from them each year. 
  • Different lenders will offer different terms on their loans. Lenders in states with interest caps will not be able to charge APR higher than legislation dictates. For instance, interest on loans in Colorado cannot exceed 36%.
  • If you are struggling to repay your loan, communicate that with your lender and try to agree upon an adjusted repayment plan (Arrangement To Pay). 
  • Failing to repay your loan can result in late fees and can even incite threatened legal action. 


What Is a Payday Loan Direct Lender Best For?

Different direct lenders will apply different terms to their loans. Some lenders will have lower interest on loans than others, some will want debts paid back quickly, and some will offer larger loans than others. 

Direct lenders will also have varying eligibility criteria. For instance, some lenders will require you to have a minimum monthly income of $800, while some will require a minimum monthly income of $500, and still others don’t have an income requirement at all. 

Some direct lenders will require a guarantor to sign your contract. This is because they want to ensure that they will get their money back in their hands, whether that is from you, or from your guarantor. 

Additionally, some direct lenders will require you to have a minimum credit score of around 600, while some lenders won’t carry out a credit check at all. If you find that your credit score wont’ get you a loan you may have to consider a no credit check loan.


What Happens If I Default On Repayment?

Failing to repay your loan on time could lead to many possible consequences. In extreme situations, your lender may threaten you with legal action, or even take you to court. Don’t worry – most lenders won’t do this, and would rather settle the dispute privately than having to engage legal support. Nevertheless, this is a possibility, making it all the more integral to repay your debt as you have agreed you would. 

If you fail to repay your loan it can make it more expensive. You could be hit with late fees, and you will encounter damage to your credit score. This is a long-term problem that should be avoided at all costs. Given that lenders typically refer to your credit score when approving you for a loan, failing to repay your debts could damage your credit score, thus preventing you from securing credit in the future. 

Additionally, having a weaker credit record will mean that many lenders will only offer you a loan with very high interest in the future. Therefore, it is in your interest – both for now and for the future – to pay back your debt fully and on time. 


Will My Lender Help Me If I Can’t Repay My Loan?

Your lender wants you to be financially comfortable but also aims to have their money back on the original terms that you both agreed on. Many lenders will be willing to adjust your repayment plan according to your circumstances. If you find yourself unable to repay, you should contact your lender and discuss an alternative repayment plan. 

If you decide that a broke like Funding Zest is a better option to save you time and perhaps money to get your loan as quick as possible, we’re ready to help. Just click on one of our Get Started buttons to begin the loan process.


What Is A Payday Loan?

Payday loans are short-term, high-interest loans that are there to keep you afloat when you’re struggling to make ends meet. 

These loans should be used in urgent situations that you didn’t anticipate, such as if you’ve been hit with a medical bill or car repair bill that you were not expecting. 

Payday loans should not be considered a long-term source of financial security. This is because of the high-interest rates that typically accompany the loans, making them unsustainably expensive to habitually take out.

There are restrictions attached to money gained from loans. Money attained through a payday loan cannot be spent on anything illegal, and you are usually not able to spend the money on gambling.

See which states have legalized payday loans.


Can I Borrow More Than One Loan At Once?

It may be possible, yes. However, the Consumer Financial Protection Bureau is trying to limit this, in order to prevent consumers from drowning in debt. Therefore, with time, it will likely become more challenging to secure more than one loan at any given time. 

You should avoid having multiple loans at once. The onus of paying them back is very high, as interest is substantial and the consequences of not paying them back promptly are serious.

Instead, if you are in need of funds, you may want to consider creating a new budget, asking friends or family for support, or turning to a financial adviser for professional guidance.


Am I Eligible For A Payday Loan?

Direct lenders will have varying eligibility requirements, and you should contact them or refer to their website to understand what these are. However, many lenders, and loans brokers like ourselves, offer very simply eligibility  requirements:

  • Be at least 18 years of age
  • Be an American citizen
  • Have a minimum monthly income of $800 (sometimes $500, lender dependent)
  • Have a current account for us to deposit your loan into


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