Same day loans are funding options available to borrowers within a short amount of time, usually within a few hours or the same day the borrower applies.
If you’re wondering if same-day loans are really possible, we’re glad you stopped by this article. CreditNinja can help with all the info you need on the benefits and risks of getting a loan on the same day you apply. Read on to get the truth on quick loans and how to pick the best one for you.
What Is a Personal Loan?
You can use a personal loan for any purpose you see fit. Personal loans are installment loans that you repay over time with a series of regular payments. But any loan that you use for personal expenses rather than business expenses could be considered a personal loan.
When you’re shopping around for a personal loan, your credit score will play a big part in what types of loans are available to you. On the whole, a person with a good credit score has access to loans with lower interest rates and longer loan terms because they are a lower risk to the lender. Although bad credit loans online are available to people with less-than-perfect credit, their lending conditions will vary. And many times, that bad credit loan can come with many financial risks. Which is why we almost always recommend steering clear of payday loan lenders, title loans, and pawnshop lenders.
Today, many different types of personal loans are available online. Applying for a loan online will allow you to skip the long lines and lengthy paperwork necessary with storefront lenders.
Secured and Unsecured Loans
A personal loan can come in two forms:
- Secured loans.
- Unsecured loans.
Secured Loans
A secured loan is a personal loan that requires collateral, such as a house or car. Title loans are an example of secured loans. When you take out a secured personal loan, the lender will check to ensure you have collateral to back up your loan. The amount of money offered to you depends on your collateral and possibly your credit history.
If you default on a secured loan, the bank can take possession of your property and sell it to recover some of what you owe. Which is why title loans can be so dangerous, as losing a vehicle would make life much more difficult.
Unsecured Loans
An unsecured loan is a loan that doesn’t require the borrower to put up any collateral. Instead, it relies on your credit score and income level to determine whether you should be approved.
There are a lot of examples of unsecured loans, including: personal installment loans, payday loans, student loans, and more. Without collateral to secure the loan, the lender will likely look at your income, your credit score and credit history, and other financial information to determine whether to approve you. Although some payday loan lenders may not even run a credit check at all. This is one way to gauge the credibility of a particular lender. Lenders with credibility will want to run a credit check.
Below is a quick breakdown of some common loan types you may be able to get a same day deposit on:
| Loan Type | Application Process | Approval Time | Funding Time | Credit Check | Collateral Required | Typical Loan Amount | Typical Interest Rate |
| Payday Loans Online | Online form | Within minutes to hours | Same day deposit | Usually not required | No | Up to $1,000 | High (can exceed 300% APR) |
| Personal Loan | Online form | A few hours to a few days | 1-7 business days | Required | Sometimes | $1,000 to $50,000 | Varies (can be as low as 6% APR) |
| Title loan | Online or in-person | Within minutes to hours | Same day deposit | Not always required | Yes (vehicle title) | Up to $10,000 | High (can exceed 300% APR) |
| Installment Loan | Online form | A few hours to a few days | 1-7 business days | Required | No | $1,000 to $5,000 | Varies (can be as low as 6% APR) |
Same Day Loan Examples
A same-day loan is precisely what it sounds like—a personal loan you can apply for, be approved for, and get the money all in the same day. If your bank account is empty, a quick loan can save you. However, if not appropriately managed, a quick loan can haunt your credit history for quite some time. Getting a same day loan with poor terms and interest could lead to even more financial harm in the long run.
Payday Loans Online
Payday loans are a fast-access financial product that you can use to borrow money for a short time. These short-term, high-interest loans are typically smaller than many other personal loans. Payday loans online have long been a resource for people who do not have access to credit cards, banks, or credit unions. And many times they’re even available to unemployed borrowers.
Payday loans online generally range from $100 to $1,000, with the average borrower taking out about $375 per loan. Unlike a traditional personal loan, online payday loans are sometimes no credit check loans, making them attractive to many people with bad credit. But the fact that many payday loan lenders don’t check credit is actually a red flag. They may be able to give a customer a loan on the same day, but it could be at the expense of that customer’s financial well-being.
The payday loan application process is often very fast. One can apply for online payday loans through a mobile app or in person. They are often approved the same day. Once the loan agreement is approved, the loan is sent electronically to the borrower’s bank account. They might also provide you with a check or cash the day you apply.
But just because these loans are quick and easy does not mean they are safe. Be aware of high interest rates, short repayment periods, and unfavorable loan terms. Speed and convenience may be attractive, but many payday loan lenders are hoping to take advantage of you financially.
Cons of Same Day Online Payday Loans
Online payday loans are how many people with bad credit get the funds they need. This can make it seem like they’re much more manageable than they are. However, many other options are safer and more affordable, like peer-to-peer lending, lines of credit, or personal installment loans.
The reality is that even though they are accessible, same-day payday loans online can be expensive and confusing. Unfortunately, the high-interest rates and additional fees over time can make it challenging to pay back the loan and lead to a cycle of debt. The most difficult aspect of these loans is that the principal and high interest rates are due back by the borrower’s next payday.
A payday loan works best if it is repaid in full by the due date—which is usually about two weeks after you get the cash. However, according to USA Today, about 80% of online payday loans are not repaid by the end of their term.1 Payday lenders then roll over the balances into new same day payday loans online. The rollover process repeats every time the payday loan is not paid off. This compounding interest is how the typical same-day payday loan has an annual percentage rate (APR) of 300% or more.
You will ultimately have to pay back much more than what you borrowed with online payday loans. Paying off such an expensive loan in only about 14 days is not easy.
Alternatives to Same Day Loans
If you don’t want to deal with same day payday loans online, that doesn’t mean you can’t find multiple direct lenders with options that work for you. In addition to the following options, there’s also:
- Peer-to-peer lending.
- Lines of credit.
- Personal installment loans.
Your credit score might be a more important factor for peer-to-peer lending or lines of credit, but there’s still a chance you could be approved.
Credit Cards
Pulling out your credit card may not seem like the best idea if you’re in debt or unemployed. But, when you compare the overall costs, credit cards are a better option than same day payday loans online. However, it’s important to regularly pay off your balances to avoid accumulating too much credit card debt. According to the Federal Reserve Bank of New York, consumers owed an average of $986 billion in credit card debt in the beginning of 2023.2
On average, credit cards charge close to 16% interest per transaction. Annual credit card fees can range from $15 to $300, depending on the type of credit card you have and your credit score. On the other hand, payday loans online carry an average APR of 300% or more. Additionally, they include more fees every time the loan rolls over.
Credit Card Cash Advance
Many credit cards also allow customers to take out a cash advance. That means that a cardholder can draw money from almost any ATM in the world. This option makes credit cards even faster than online payday loans! This could also be viewed as a small same day loan.
Should you go this route, remember that using your credit card is risky because the debt can rack up quickly. Learning how to manage a credit card wisely is essential. Be sure that you make a payment on your credit card every month and always pay on time.
Credit Unions and Payday Alternatives Loans (PALs)
With the changing economy, more and more people are looking for quick loans. Credit unions and payday alternative loans offer a solution to this need. They might even offer solutions for unemployed borrowers who need a same day loan.
Credit unions are not like traditional banks. Since they are non-profit organizations, they focus on providing many services to their members rather than making money. Credit union members can secure loans with lower interest rates than they might find at a commercial bank.
Payday alternative loans are quick, small-dollar loans good for meeting unanticipated expenses. Like any other credit union service, PALs are available only to members.
Then there is also the option for online payday alternative loans. Loans like these can be obtained through a lender’s website without ever leaving the house and visiting a storefront location.
FAQ: Same Day Online Loans
Regulations for same day loans can vary greatly depending on the country and state. In the United States, for example, payday loans online are regulated at the state level and the laws can vary significantly. Some states have strict regulations that limit interest rates, loan amounts, and fees regarding same day deposit loans and payday loans, while others have few restrictions. It’s important to check the specific laws in your location.
The maximum amount you can borrow with same day loans also varies by lender and by state regulations. For payday loans online, the amount is often between $100 and $1,000. Some lenders may offer larger amounts for installment loans or personal loans.
The default rate refers to the percentage of same day loans that are not repaid. Default rates can be high for payday loans online due to their high interest rates and the financial instability of many borrowers who take out these types of same day loans.
Late payment fees are set by the lender and should be outlined in the loan agreement. They can vary widely, so it’s important to understand these fees before taking out same day payday loans or any other type of funding.
Some lenders may charge a fee if you repay your loan early (known as a prepayment penalty). Not all lenders charge these fees, so it’s important to check the terms of your loan.
The minimum credit score required for a same day loan can vary by lender. Some payday lenders or no credit check loans don’t require a traditional hard credit check, while other types of lenders may require a fair or good credit score.
The amount you can borrow depends on the lender, the type of loan, and your financial situation. Some lenders may offer larger amounts for installment loans or personal loans. While approval amounts for loans online same day can vary, it’s often between $100 and $1,000 for payday loans online same day.
Anyone who meets the eligibility requirements can apply for a same day loan. Eligibility requirements can vary by lender, but generally, you must be at least 18 years old, have a valid ID, have an active bank account, and have a regular source of income in order to get loans online same day. The lender will decide if you’re eligible based on their specific criteria and any applicable state laws.
As mentioned above, requirements for access to loans online same day typically include:
– Borrower being at least 18.
– Borrowers having a valid ID.
– Borrow proving they have a source of income.
Some lenders may also check your credit or require bank account information before approving you for same day loans.
Interest rates can vary widely by lender and by type of loan. Payday loans online same day may have vastly different interest rates than other types of funding, such as installment loans that come with a same day deposit. This is why it’s important to shop around and compare rates before taking out any type of loan, including fast same day loans.
‘Loans online same day’ and ‘same day payday loans’ typically refer to short-term loans that are approved and deposited into your account within the same day of your loan request. ‘Same day personal loans’ can also be approved and funded on the same day, but they usually refer to larger amounts that are repaid over a longer period.
‘Credit check loans’ refer to a loan where the lender assesses your credit scores to determine your creditworthiness. On the other hand, ‘best online payday loans’ might not always require a credit check, especially if they are from direct lenders. However, no credit check could mean higher interest rates and fees.
‘Cash advance loans’ and ‘cash advance online’ typically refer to small, short-term loans that are expected to be paid back with your next paycheck. They can be obtained online or at a physical location. ‘Short-term loans’ can also be cash advances, but they can have a slightly longer repayment period.
A ‘direct lender’ is a financial institution that directly provides loans to borrowers. When you apply for ‘same day loans’ with a direct lender, you communicate and negotiate directly with the institution that will provide the loan. This can often expedite the loan request process, enabling you to receive a same day deposit.
A Note From CreditNinja
CreditNinja knows that getting fast cash when you need it isn’t always an easy experience. And if it is easy you’ll need to make sure that it is safe. Many online loans provide same-day funding without the oppressive fees of payday loans online. However, you must practice good financial habits to manage and eliminate your debt in the long run. CreditNinja suggests seeking out potentially more sustainable options, like using cash from a savings account, asking a friend or family member for a small loan, or even getting a temporary part-time job before applying for loans online same day.
References:
- Need to escape payday loan debt? Here’s how.
- Household Debt and Credit Report – FEDERAL RESERVE BANK of NEW YORK
- What is a credit score? | Consumer Financial Protection Bureau
- CFPB Finds Four Out Of Five Payday Loans Are Rolled Over Or Renewed | Consumer Financial Protection Bureau
