Can You Have Two Payday Loans at Once? (Yes, But You Don’t Need To)
Do you need a large sum of money right now?
If so, you’ve probably considered taking out a payday loan.
If the amount you need is more than $500, though, you may be considering taking out more than one.
But can you have two payday loans at once?
Can You Have Two Payday Loans at Once?
As you, no doubt, guessed from reading the title of this blog post, yes, you can definitely have two payday loans at once.
In fact, there’s really no limit on how many you can take out at the same time. That’s completely up to the lenders who issue the loans. If they look over your information and don’t have an issue with you taking on a second loan, that’s their prerogative.
That said, it shouldn’t be too surprising that this very rarely happens. While payday lenders will definitely issue you loans back-to-back and are happy to do this over and over again, they most likely won’t be willing to issue you two at the same time.
After all, you have to use your paycheck to secure a payday loan. That makes for a very limited amount of collateral. Unless you have a second job with a second paycheck, that first one is only going to go so far.
The Problem with Payday Loans
Although they often get a bad name, payday loans certainly serve a purpose. They provide people with financial help who would otherwise be in serious trouble without this sudden influx of cash.
That said, this doesn’t mean that payday loans are an ideal solution by any means. In fact, for years, people have even called for banning this type of lending.
The major problem with it is that it produces a vicious cycle. Someone borrows the money they need against their paycheck. Once they receive their paycheck, they need to spend the majority of it – maybe even all of it – to cover the amount they borrowed plus interest.
Then they need another loan because now they don’t have enough in their paycheck to last them for two more weeks.
3 Reasons Personal Loans Are More than Multiple Payday Loans
Fortunately, there is a simple alternative to taking out two payday loans at once: personal loans.
If you’re in need of a large sum of money right now, here are three reasons to apply for a personal loan before taking out a payday loan, much less two.
1. You Can Borrow Much More
Often times, people take out payday loans because they suddenly need money to handle something like emergency car repairs. They simply weren’t planning on needing to spend a large sum, but now they must or it means going without their vehicle.
This is the type of expenditure that can quickly lead to multiple payday loans. After those initial repairs, more are needed, or another unexpected financial obligation pops up.
Personal loans can cover significantly higher costs because they’re not tied to your paycheck like a payday loan is.
Also, keep in mind that there is no limit on what you can spend your personal loan on. So, if you need something like car repairs, you can actually borrow more than the costs to be sure you’ll have a little extra just in case.
2. The Loan Comes with a Longer Payback Period
Payday loans almost always need to be paid back before the borrower receives their next paycheck. Essentially, a post-dated check is used as collateral, so the lender can cash it on the day the borrower is next paid.
This is how that vicious cycle begins.
As personal loans come with longer payback periods, this isn’t a risk. You have months or even years to use the money and pay back the total you owe.
3. These Loans Carry Much Better Interest Rates
Finally, personal loans come with significantly better interest rates. Payday loans are notorious for having massive interest rates, even as high as 400% APR.
Again, this can make it quite difficult to “recover” from taking out a payday loan. Two or more can make it nearly impossible.
Don’t Take Out Two Payday Loans at Once
As you now know, yes, you can have two payday loans at once, but it’s unlikely you’ll receive one from the same lender and, most importantly, it’s an unnecessary and bad idea.
Instead, if you need money right away for any reason whatsoever, take out a personal loan instead.
You can receive up to $35,000 and filling out a personal loan application will take no more than 10 minutes. Once you’ve completed it, we’ll take your information to a number of different lenders, so you can feel confident you’re being offered the best possible terms.