The Logistics
If you want to take out a payday loan, you will need to have a bank account. (You generally don’t need the account to be affiliated with the lending agency.) You will also need a job or other source of regular income, since this is what you are using to repay the loan (you will likely be required to show a recent pay stub as proof of your income), and you will need to be able to provide adequate proof your identity (such as with your driver’s license or passport).
Before you sign any paperwork for such a loan, you will want to know up front 
exactly what the loan will cost you by the time you are through. The lender is required by law to disclose the terms of the loan, including the interest rate and/or fees involved. In addition, you should ask how the loan works and how repayment is arranged. For instance, some loans are set up to automatically renew and the charges are automatically deducted from your checking account, while others require you to write a check to cover the loan, which will then be cashed on your payday to pay the loan and fees back. In addition, if you don’t have enough money in your account on payday to cover the amount plus fees, you can face additional charges for a bounced check (or checks, since the lender has a legal right to try putting through the check or electronically debiting your account three times to see if the money will clear) and you will also incur additional fees from the lender for failing to make good on the loan.
Laws Vary By State
In addition to following federal lending regulations, payday laws are also governed by state laws. At the present time, most parts of the country do allow this practice to occur (although there are certain rules and restrictions enforced in some states). To find out if payday loans are allowed in your state, visit PayDay Loan Consumer Information and browse the state information by state. You can also view a more in-depth rundown of the terms and limitations in each state through the National Consumer Law Center's Summary of State Laws.
You will notice that the amount of the loan allowed, the cap on the interest rate, the length of repayment and what recourse lenders have if you don’t repay the loan varies from state to state. In addition, there are several states that prohibit payday loans entirely. However, residents in these areas can still access such cash loans via the Internet, which comes with its own set of costs and risks.
Online Loans
If you are tempted to turn to the Internet to borrow the money you need until your payday comes, experts advise you to find out more about what you are agreeing to before you finalize such an arrangement. Online loans can often be even more expensive than those you take out locally. Lenders are banking on the fact that the convenience will be worth the extra cost to consumers. In addition, when you provide your personal financial information online if it isn’t through a secure web connection, you can be putting yourself at greater risk for identity theft and other security problems.
