How to Apply for a Payday Loan Online that's Not a Loan Scam

Beware of falling for an online payday loan scam.

Applying for a payday loan or short-term loan online may seem like a fast way to get cash, but you must be careful. Among the legitimate payday loan companies online, there are scams designed to take your money or steal your identity. However, if you find yourself in need of a short-term cash loan for car repair, a medical bill or any financial emergency, you can safely apply for a payday loan online if you follow a few steps.


Step 1

Search online and you will find many companies offering payday loans. Even if they are not scams, they may not be right for you. Even legitimate payday loans can be expensive. Look at the terms and the requirements and select what seems to meet your needs. You will probably need to meet minimum age and income requirements and have a bank account. Consider the loan term, costs and the repercussions if you can't repay on time. After you have found a few companies that meet your needs, explore further.

Step 2

Check that the company's name, address, phone number or similar contact information appears on its website. Type the company's name into Google or another search engine along with the word "scam" or "rip-off" to see if you can find any complaints or evidence of a loan scam. You can also search for the phone number or the address to see if they seem legitimate or view its Better Business Bureau listing.


Step 3

Compare the loan rates of several companies that seem honest. It's helpful to compare Annual Percentage Rates (APRs) as well as the cost in dollars. If one loan is amazingly cheaper than the rest, be cautious. Payday loans involve risk for loan companies so they're expensive. A cheap payday loan that seems too good to be true may be a scam.

Step 4

Apply for a payday loan online when you have found a few companies in which you are interested. Make sure the application does not obligate you at all. Usually, you will fill out an application online and within a few hours or the next day you will receive an answer by email or phone. You can then decide if you want to accept the loan. If one company asks for far more personal information than the others, be careful. It may be a scam to steal your identity.


Step 5

Never comply with a payday loan company that seeks money before providing the loan. That's the most obvious sign of a loan scam and the easiest to avoid. A payday loan company should first deposit the cash into your account before you need to begin repayment.