Need a quick loan but hesitant to take out a payday loan at your local check-chasing business? You have good reason. Officially called deferred deposit loans in Hawaii, these short-term loans can cost you a lot in interest and fees.
In Hawaii, these loans are limited to $600 for up to 32 days with a maximum annual percentage rate or APR of 460%. Lenders can also collect finance charges of 15% of the amount of the loan.
There are other, more reasonable ways to obtain short-term loans – without the high interest rates and finance charges – through companies like MoneyLion.
Options For Payday Loans in Hawaii
Traditional payday loans are short term, unsecured loans with exceptionally high interest rates. They can provide quick cash, but at an extremely high price. Finance charges alone – before the very high interest – would be $90 on a $600 loan.
You’d have to pay back a total of $795 for your $600 loan with interest and fees. And that’s if you repay it in two weeks. The longer you have the loan, the more expensive it gets.
Requirements – To get a payday loan, you need to prove you have a regular source of income.
Credit Affects – Most payday loan vendors do not check your credit score, making it easy for someone with poor or no credit to get a loan. If you don’t repay the loan, you could see the negative effect on your credit.
Max Loan Amount – The maximum for a payday loan in Hawaii is $600.
Maximum Fees, Interest, and Terms – In Hawaii, you can take out one payday loan at a time – you must repay this loan before getting another. The maximum APR is 460% and the maximum loan term is 32 days. Lenders can also collect a finance charge of 15% of the amount of the loan as well.
Penalties – Lenders can charge one collection fee not to exceed $20. Interest continues to accumulate at the extremely high rate until you repay the loan.
Payday Loan Alternatives in Hawaii
You may be thinking ‘there’s got to be a better way.’ There are more attractive – and cost-effective – alternatives to high-interest payday loans.
MoneyLion offers cash advances of up to $250 with 0% APR with an Instacash membership.
Just link your primary checking account in the app to qualify. There’s no credit check. The membership uses your banking activity and direct deposits to determine your advance amount.
The amount available can vary, but it’s never lower than $25, and can go up to $250. Instacash does not build credit since the transactions are not reported to the credit reporting agencies. However, you can borrow money – and build your credit score – with a MoneyLion credit builder loan up to $1000.
Credit Builder Loans
A credit builder loan is a small, unsecured, low interest loan. Since it’s a small amount and doesn’t require collateral, it’s easy to get for someone with no credit or low credit to apply and get approved for one.
The lender reports your payments to the credit agencies. If you make your payments on time, your credit score will go up.
Why does your credit score matter? It’s a signal to lenders how you deal with your finances. A high credit score means you pay your bills, and so are eligible for better loan terms. A lower score means that a lender may not get their money back, or may get it back later than expected. Credit scores can also impact things like getting a job or renting an apartment.
You don’t need to have a top credit score to get a credit builder loan. However, the bank may require you to have a certain amount of money in a savings account, and proof of a steady income. You may be asked for pay stubs, bank statements, or tax forms.
To get a credit builder loan from MoneyLion, start by downloading the MoneyLion app. Create an account and apply to be a MoneyLion Credit Builder Plus member in just minutes. Once you’re a MoneyLion Credit Builder Plus member (there is a $19.99 membership fee), you’ll be eligible for up to a $1,000 loan at a low APR and zero- interest Instacash advances.
Seventy percent of the people who use MoneyLion credit builder loans raise their credit score by over 30 points in their first 60 days.
Choose the Smarter Alternative – MoneyLion Short Term Loans
Take charge of your finances and your credit rating. Don’t get caught up in the predatory interest and fees charged by standard payday loans.
Download the MoneyLion app. Open an account. And learn how you can get small loans with no or low interest, build your credit rating, and position yourself for long term financial stability.