In most cases, you can only obtain one payday loan at a time. However, in some states, you can apply for short-term loans from different payday lenders and get approved simultaneously without a credit check. This means that you may end up with more than one payday loan. In short, the answer is yes, you can get another payday loan if you already have one.
But the truth is that it's more complicated than that. You should not attempt to get more than one payday loan. Doing so will trap you in a debt cycle and it could take months or even years to recover from it. Instead, explore some of the other options available to you.
The best way to find out how many payday loans you can have is to ask your lender. Check their rates and terms pages on their website, call their customer service department or visit one of their payday loan stores. A knowledgeable lender will be aware of restrictions in your state and can provide you with the information you need. Recent CFPB regulations have made it legal for payday lenders to give out loans without considering your ability to repay them.
In states where there are no limits on the amount of payday loans you can have, this means that borrowers can accumulate quite a few if they are not careful. The minimum loan duration may be less than 91 days if the total monthly payment of the loan does not exceed an amount that is 6% of the borrower's verified gross monthly income or 7% of the borrower's verified net monthly income, whichever is greater. Additionally, damages, costs and disbursements to which the licensee may be entitled by law in connection with any civil action to collect a loan after default are limited to the amount of the loan originally contracted. Although a payday loan may seem like a quick fix, there are other options that can help you stay out of a debt cycle.
Before applying for a second, third or fourth cash advance loan, consider the terms of the loan carefully. If you already have one or more outstanding loans, a payday lender might consider you too risky and deny you more loans. Cash advance apps, sometimes also called paycheck advance apps, are similar to payday loans but don't charge interest. If you need to borrow more money, consider closing your existing payday loan early and then look for a larger loan amount through a credit union that offers much lower rates, using a secured loan or selling all the items in your house that you don't use. The same practice applies in the UK and there have been horror stories of people who applied for 10 or 15 payday loans and ended up in horrendous debt as a result.
In the long term, work on fixing the underlying financial issues that led you to a payday loan counter in the first place. Payday loans are short-term loans with high interest (and high fees) that must be repaid within a few weeks. A loan agreement may provide for an acquisition charge and an interest charge on the cash advance that does not exceed a rate or amount that would produce the same effective return as permitted by law. Payday loans are particularly predatory because they are known to have triple-digit APRs that make it difficult to repay them. Even payday lenders know that if you have one or more outstanding payday loans, the risk of you not repaying them is extremely high.
With the exception of an installment payday loan, no payday loan may be granted to a consumer if the loan would result in them becoming indebted to one or more payday lenders for a period exceeding 45 consecutive days.
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