Payday loans are a type of loan borrowed and repaid on your next payday. Most people use these loans to take care of emergencies they can't finance at the time. 

These loans are convenient for quick cash but come with high fees and interest rates. This guide will walk you through everything you need to know about payday loans, so keep reading.

How Does A Payday Loan Work?

Payday loans, such as Viva Payday Loans (with lower interest rates of 5.99% to 35.99%), can be a quick and easy way to get the cash you need, but they also come with some risks.

Here's a quick overview of how payday loans work:

• You fill out an application with a lender. This can be done online, over the phone, or in person.

• The lender reviews your application and determines if you are eligible for a loan.

• If approved, the lender will give you a loan amount and terms.

• You agree to the terms and receive the loan.

• You repay the loan on your next payday or as agreed upon with the lender.

Why You Might Want a Payday Loan

People take payday loans because of so many reasons. Some people use it to cover emergency expenses, while others use it for additional funds during tough times. Whatever your reason is for wanting a payday loan, it's important to understand how they work before you apply.

For example, you could take a payday loan to pay for a car, medical bill, or home repair. You may also use it for other needs like groceries or utility bills. Whatever the case, a payday loan can help you get by until your next paycheck.

It's important to remember that payday loans are not meant to be a long-term solution. They are typically used for one-time expenses and should be paid back within a few weeks. If you need a payday loan regularly, it's time to reconsider your budget and make changes.

Laws and Rules of Payday Loans

You might consider a payday loan when you're in a financial bind and need cash fast. But before you sign on the dotted line, it's important to understand the laws and rules governing payday loans.

Here are some basics laws and rules about payday loans:

• The amount you can borrow: The amount you can borrow from a payday lender depends on your state. Some states have laws that limit the amount you can borrow, while others have no limits.

• The interest rate: Payday loans come with high-interest rates, ranging from 300% to 700% APR.

• The repayment period: The repayment period for a payday loan is typically two weeks, but it can vary from lender to lender.

• The fees: In addition to the high-interest rates, payday loans also come with fees. These can include an origination fee, a loan processing fee, and a late payment fee.

• What to do if you can't repay: If you can't repay a payday loan, the lender may offer to "roll over" the loan, extending the repayment period and adding more fees. If you can't repay the loan after it's been rolled over, the lender may then offer to settle the debt for a lump sum that's less than what you owe.

As you can see, payday loans come with several important rules and regulations. It's important to understand these before you take out a loan. Otherwise, you could find yourself in a cycle of debt that's difficult to break free from.

How Much Does a Payday Loan Cost?

Payday loans are short-term lending where borrowers typically take out a small loan, usually for $500 or less, to be repaid with their next paycheck. Because of the high costs associated with payday loans – including fees and interest rates exceeding or close to 500% APR – these loans can quickly become expensive and difficult to repay.

For example, let’s say you take out a $500 payday loan with a 15% fee. This means you’ll need to repay a total of $575 – just $75 in fees for borrowing the $500. If you can’t repay the loan in full when it comes due, you may be able to “roll it over” by paying the $75 fee and borrowing the $500 again for another two weeks.

However, each time you roll over the loan, you’ll incur additional fees, making it even more difficult to repay. The Consumer Financial Protection Bureau estimates that four out of five payday loans are re-borrowed within a month.

Can You Build Credit With Payday Loans?

No, payday loans, in most cases, aren't reported to the national credit reporting institutions. So, if you're hoping to improve your credit score by taking out a payday loan and then paying it back on time, you probably won't see much difference.

In some cases, however, the lender may report your loan to the credit reporting agencies if you default on the loan, which could hurt your credit score.

If you're considering taking out a payday loan, understand all the fees and terms before you sign any paperwork. And, keep in mind, just because a payday loan is easy to get doesn't mean it's the best financial decision for you.

In Conclusion 

As you can see, there is much to know about payday loans. However, with the proper knowledge, it is possible to get a payday loan without having to worry about the negative consequences. 

With the right lender, you can get a loan that will help you through a tough financial situation. And with the proper research, you can find a lender that will offer you a loan with reasonable terms and conditions.