Paying back a payday loan may seem like a daunting task, but it doesn’t have to be. In fact, in many cases, you don’t even have to repay the loan on your actual payday. Before you take out your next cash advance, learn about the various repayment options to see which one works best for you. Also remember that each state has different lending regulations, so always check with your lender to determine the specific repayment options available in your area.
Repay on Your Next Payday
The most common repayment scenario is paying back the loan in full, plus the interest, on your next payday. When you take out the loan, your lender will give you the specific due date. At that time, you’ll also need to provide either a pre-dated check or access to your checking account. Oftentimes, the lender will automatically cash the check or debit your account on the day the loan comes due, which helps you avoid late fees. Just make sure that money is in your account on the due date.
Rollovers and Renewals
Another option offered by some lenders is referred to as a loan rollover, or loan renewal. If you are unable to pay your loan on its initial due date, you can rollover the loan to a later date and only pay the fee. In doing this, you’ll incur another set of fees in addition to the original fee and loan amount. So, if you borrowed $300 and have a $40 fee, you’ll just need to pay the $40. Then you’ll get a new due date for the original $300, plus an additional fee for extending the loan. It’s best to limit the amount of times you renew or rollover your loan to avoid paying those extra costs, but this option can come in handy in the case of an extended emergency situation.
If you get your next paycheck early, consider repaying your cash advance ahead of its due date. You’ll still have to pay the fee, but you’ll have the peace of mind knowing that the loan is paid in full without incurring additional late fees. Most lenders offer this service for free, but ask about prepayment fees ahead of time just in case there is a charge. If that is the case, you’re better off setting the money aside and waiting until the original due date to make your payment.