Payday installment loans are suited for people who need a reasonably small amount of money in a short period of time. These loans are popular financial resources because they are easy to get for most people who are employed full time or near full time. Even with bad credit, you can still qualify. However, not all people who apply for a payday installment loan are approved. The following are some of the more common reasons why some people can’t get or disapproved from payday installment loans.
Some people who apply for a payday installment loan are disapproved because they don’t meet the minimum income requirements. Even the most flexible payday lenders cannot loan money to someone who grosses less than $800 per month. But, anyone working full time and making federal minimum wage will easily meet this requirement.
Someone who is self employed will find it more difficult to get a payday installment loan because many lenders do not accept self employed income as security for a payday installment loan. But there are those lenders who will not require you to provide a certain number of bank statements to verify your income.
People with no bank account can’t get a payday installment loan either. A bank account is a universal requirement to get a payday installment loan. A typical payday installment loan is due to be repaid on either your next payday or the following payday. The money is usually deducted from your bank account on the agreed upon date. If you have no bank account, the lender will not have a way to accept your payment. So it is difficult for applicants to be approved for a payday installment loan without a bank account.
As the term “payday loan” suggests, you must have some kind of job or current employment. The paycheck you will be receiving serves as your passport to qualify for the loan. Even if you have a healthy savings account, you must have income or you will be disapproved for a payday installment loan.
Another red flag for most payday installment loan lenders is a previous outstanding loan with another lender. A person with multiple loans outstanding is viewed as a serious risk for default and returned checks. Most payday installment loan lenders use a data verification service to identify applicants with multiple outstanding loans and/or cash advances, to confirm that the banking information provided by the applicant is true. If you have had returned checks in the recent past, especially to a payday loan lender, this information will come to light and will prevent you from getting a payday installment loan.
Bankruptcy, especially in the last year or two, may also be a reason why some people can’t get a payday installment loan. While the information provided to the lender is not a credit report, it will reveal a recent bankruptcy. Until you have put some time between you and your filing of bankruptcy, you will be considered financially unstable and will be disapproved for getting a payday installment loan.
If you fall into one or more of the above categories that may put you at risk of being disapproved by payday lender, don’t dismay. Not all lenders consider every one of these factors in their approval process. There are lenders who will consider and give you other options. However, be cautious when dealing with these lenders. Before getting a payday installment loan, take an honest look at your situation. If your debt is growing out of control be sure to use these loans rarely and carefully.