Payday Loans in New York: A Full Guide on How to Apply

New York can be an expensive city to live in. A high cost of living is the norm, and sometimes you need to take out loans to pay for your expenses.

We'll be guiding you through all you need to know about bad credit loans in New York and how to apply.

What Is a Payday Loan, and Who Is It For?

You've probably heard of the term "bad credit loan" before, but what makes it bad?

We've got the answers to these questions here:

How Do Payday Loans Work?

Having a bad credit score means that you've defaulted on loans in the past and haven't been very reliable in paying back when you borrow money. 

You'll have a difficult time getting other types of loans approved.

Bad credit loans usually don't require a credit check to get approved. These loans typically need you to put up something you own as collateral.

After the loan terms are agreed upon, you'll receive a loan offer and then pay back the loan over a certain period.

WARNING: New York has stricter regulations, requirements, and qualifications when applying for bad credit loans. Make sure to read up on them in our guide below.

What Are the Benefits of Payday Loans in New York?

Bad credit loans in New York have a lot of advantages for people with poor credit. Here are three of the benefits:

1. Fast Access to Cash Even With Bad Credit

One of the most significant benefits of these loans is that you can get cash loans quickly, even with bad credit.

Getting other types of loans in New York is difficult if you have poor credit. Bad credit loans focus on other things to guarantee they can get paid back, specifically with collateral.

This is perfect for people struggling to pay off their current debts while still needing cash for monthly expenses.

Remember, the cost of living in New York is high. These loans can help many people stay on their feet and make it to a time when they can fully pay all debts and expenses.

2. Will Help You Raise Your Credit Score

A low credit score can be a hole you have difficulty getting out of.

However, your credit score will increase if you can successfully pay off your bad credit loan.

If you keep successfully paying off loans, you will get a HIGHER credit score. Then, you'll be able to apply for loans that require a good credit history.

3. Simplifies and Consolidates Your Debt

If you have multiple loans from different lenders, taking out a bad credit loan to pay off all of them will simplify things for you.

It lets you focus on paying off one loan instead of many smaller ones. This helps if you confuse differing interest rates and term payment schemes.

What Are the Types of Online Payday Loans in New York?

There are many types of bad credit loans that you can find in New York. 

These can be classified as "installment loans" because the borrower must pay the lender back in several pre-agreed terms. Here are the most notable ones:

1. Secured Personal Loans

A personal loan is a form of installment loan. Installment loans are loans where the lender gives money to a borrower with the expectation that the borrower will pay it back over time. 

There are also two kinds of personal loans: secured loans and unsecured loans.

Secured loans mean the borrower has to offer something as collateral to the lender. If they can't repay the loan, the lender can take the collateral instead.

Getting a secured loan even with poor credit doesn't mean guaranteed approval.

Your loan may not be approved if you don't comply with the New York-specific requirements and qualifications.

2. Unsecured Personal Loan

One of the differences between secured and unsecured loans is that secured loans involve offering something as collateral while unsecured ones don't. 

Therefore, a secured personal loan can be easier to get than an unsecured one if you have a poor credit score.

A credit history check isn't necessary but is more likely to happen here.

Some online lenders check your credit score because they don't have a guarantee that they'll be paid back if you default on the loan.

Another difference between the two types of loans is that unsecured personal loans typically have higher interest rates. 

3. Auto Loans

An auto loan agreement between the lender and borrower where the borrower offers the car he's trying to pay for as collateral to the borrower.

The borrower will then pay the lender the value of the car plus interest over a period, usually around three to five years.

This loan is for people who want to buy a car but don't have enough money to pay for it upfront.

IMPORTANT NOTE: Good credit isn't necessary to get an auto loan in New York, but it does help get lower interest rates and better terms.

4. Mortgage Loans

Similar to an auto loan, a mortgage loan involves a person borrowing money from a lender, but a house is used instead of a car as collateral. 

The lender receives a monthly payment from the borrower throughout the loan term.

The interest rate from these loans is usually still high but lower than payday loans or unsecured personal loans. 

NOTE: These loans are usually taken out for home improvements or if the borrower doesn't have enough cash to buy the house.

Who Are Payday Loans For?

Bad credit installment loans can be an excellent option for many people.

These loans are not for people with regular, verifiable income or cash flow. 

If you need money now, have something to offer as collateral, and have a regular monthly income, bad credit installment loans are definitely for you.

The minimum loan amount is $1000, while the maximum loan amount is $5000.

Since these loans are usually offered at a high annual percentage rate, they're not for people who already have good credit. They can get much better rates elsewhere.

3 Easy Steps to Apply for a Payday Loan in New York

Now that you're interested in New York installment loans for people with bad credit, here are three quick steps you can follow to apply:

Requirements and Qualifications

Here are the requirements when applying for New York installment loans. Some of them are stricter than in other states.

Check them out here:

• Proof of residence in New York
• Proof of income of at least $1000 (NOTE: Bank statements or pay stubs are good examples of this)
• Valid savings or checking account with direct deposit
• Phone number or email address
• Cannot be a reserve or regular member of the Army, Air Force, Coast Guard, Marines, or Navy or be a dependent of one.
• They cannot be under call or order that doesn't have a period of 30 days or fewer or serving on active duty.
• Valid social security number for online installment loans
• Government-issued ID when applying through storefront lenders

Step 1: Fill Out the Application Form for Installment Loan Online or In-Store

Before you apply, be sure to pick from reputable lenders.

Many in New York include tribal lenders, lending companies, federal credit unions, and direct lenders.

There are TWO WAYS to apply, either to apply for the loan online or in-store. There are two different required documents for applying to either.

When applying online, you need a valid social security number and a government-issued ID when applying in-store.

Once you've decided which one to do, complete the form with all the details they ask for.

IMPORTANT NOTE: All the lenders will offer differing loan amounts based on factors like the value of the car or house you're putting up as collateral. 

Step 2: Send the Required Documents

To ensure you get guaranteed approval, include all required documents when sending the application and that you fit the qualifications.

• If the application is ONLINE, ensure the scanned documents are clear and in standard formats like PDF, Word document, or JPEG/PNG for photos.
• If the application is made IN-STORE, ensure you bring photocopies of the documents you're turning over.

If you applied for credit check installment loans in New York, you might have to include extra documents requested by the direct lenders.

Step 3: Receive Your Cash

After sending the documents, wait for the approval. This should come either on the same business day or in a few business days, depending if you made the application online or in-store. 

Here comes the best part — getting the cash after your loan is approved. Once approved, check your bank account to see if you received the loan amount.

PRO TIP: Check if your New York bank has an app or website where you can view your bank account details. Using this app is more convenient than going out all the time.

What to Keep in Mind When Applying for Payday Loans in New York

You should be wary of some things when applying for these installment loans in New York.

Although it isn't required, loaners may do a credit check. They may ask for your credit history, credit report, or credit scores. 

This can affect the annual percentage rate (interest rate) given to you or how many terms of monthly payments you have to pay back.

Therefore, you should temper your expectations when applying for these personal installment loans.

Check the installment loan lender's website to check their rates based on credit scores. You can then decide if the interest rate is good enough for you.

Frequently Asked Questions

You may have more questions about New York installment loans for those with poor credit.

We've tried to answer the most common questions:

Can I Get a Loan With a 550 Credit Score in New York?

Credit bureaus consider a FICO score of 550 to be "very poor" as it falls in that 300-579 bracket.

Lenders may hesitate to offer loans to you that are without collateral.

However, this doesn't mean they won't approve your loan. Approval rates for people with poor credit are still high, especially for secured long or short-term loans.

REMEMBER: Credit check loans may have more requirements you need to comply with. Read the lender's website carefully so you don't miss anything.

Are Installment Loans Legal in New York?

Yes, getting an installment loan in New York is legal.

You may need an installment loan for many things, like paying off credit card debt or personal expenses. 

Are Payday Loans Available in New York State?

A payday loan is a type of cash advance where the lender now gives cash to a borrower with the expectation that they will pay it back over a pre-agreed period.

The amount given is determined by checking the borrower's pay stub or monthly paycheck.

WARNING: Since January 2022, getting a payday loan or cash advance is now illegal in New York.

Are Online Lenders Safe?

Online lenders are safe, as all data from lenders and borrowers is encrypted. Both lenders and buyers are also protected by the New York Department of Financial Services.

One of the things you can do to be safer is to choose a reputable lender for your loan.

Conclusion

New York loans can be tricky and complicated to understand, but we hope our guide has clarified them. 

The crucial thing to remember from this guide is always to check or ask the lender if you're unsure of any policy or have any questions. It's better not to assume.

Now that you're armed with all this new knowledge about bad credit loans, go and get a New York loan today!