Payday loan true cost
A Payday loanA small, short-term loan that's usually due on your next payday. The fees are very high compared to other loans.More in the glossary or Title loanA short-term loan that uses your car to back it. If you can't pay it back, the lender can take your car.More in the glossary usually charges a flat fee, like $15 for every $100 you borrow. That can sound small. But the loan is due so soon that the APRAnnual percentage rate. The yearly cost of borrowing money, including interest and some fees, shown as a percent.More in the glossary can be close to 400%.
If you can't pay it all back on the due date, the lender may let you RolloverPaying just the fee on a payday or title loan to push the due date back. You still owe the full amount, and you pay a new fee each time.More in the glossary: you pay another fee to push the due date back, but you still owe the full amount. This tool shows what that costs.
Your results
- APR
- 391%
- Fee if you pay on time
- $60
- Fees if you roll it over 4 times
- $300
You'd pay back $700: the $400 you borrowed plus $300 in fees.
What this means
- If you pay it back on time, you'd pay $60 to borrow $400 for 14 days.
- If you roll it over 4 times, you'd pay $300 in fees over 70 days, and you'd still owe the full $400 at the end.
- For comparison, a Credit unionA not-for-profit alternative to a bank that is owned by its members. It often has lower fees and lower loan rates than big banks.More in the glossary payday alternative loan can't have an APR over 28%.
How the fees add up
| Due date | Day | Fees paid so far | Still owed |
|---|---|---|---|
| First due date | 14 | $60 | $400 |
| Rollover 1 | 28 | $120 | $400 |
| Rollover 2 | 42 | $180 | $400 |
| Rollover 3 | 56 | $240 | $400 |
| Rollover 4 | 70 | $300 | $400 |
Some states don't allow payday loans, and some limit the fees or the number of rollovers. A title loan uses your car to back the loan, so if you can't pay, you could lose your car.
Cheaper options to try first
- Ask a Credit unionA not-for-profit alternative to a bank that is owned by its members. It often has lower fees and lower loan rates than big banks.More in the glossary about a payday alternative loan. Federal credit unions can charge no more than 28% APR and a $20 application fee.
- Ask the company you owe for more time or a payment plan. It often helps to ask before the due date.
- Ask your employer if they offer a paycheck advance.
- Call or text 2-1-1 to find local programs that help with rent, utilities, and food.
Where to get free help
- Credit union payday alternative loans
Federal credit unions can offer small loans with an APR of 28% or less and an application fee of $20 or less.
- 211
Call or text 2-1-1 for free, private help finding local programs for rent, utilities, food, and other bills.
- Nonprofit credit counseling (NFCC)
A certified credit counselor can go over your budget and debts with you, for free or at low cost.