Can You Have Two Payday Loans at Once?

Calculator with money

The answer to the common question of “Can you have two payday loans at once?” depends largely on what state you live in, as the law will vary across state lines. Here in Michigan, you as a borrower can legally take out a maximum of two payday loans at once, so the answer is yes. (Lenders, on the other hand, are only legally allowed to have one payday loan out per customer, so you would have to have two loans from two different lenders.) 

However, just because you can doesn’t necessarily mean you should. Taking out just one payday loan can land you in debt very quickly, let alone taking out two. Learn more about the potential risks involved with having two payday loans at once, below.

Taking Out Two Payday Loans at Once: Know the Risks

Asking “Should you take out two payday loans at once?” is just as important as asking “Can you take out two payday loans at once?” As tempting as this fast cash might be when you’re dealing with unexpected expenses, there are numerous ways payday loans can wreak havoc on your finances. 

  • Payday loans are expensive. Oftentimes, people seek out payday loans because they do not require a credit check. But with no credit check comes a sky-high interest rate, meaning that even if you’re able to pay off your loan at the due date of your next pay period, it’s likely you’ll end up paying back significantly more than you borrowed in the first place. 
  • It’s easy to end up in a debt cycle. Many borrowers find themselves unable to repay their payday loan at its original due date, which causes debt to start piling up almost instantaneously. Once it starts, it can be incredibly hard to get out of with such a high interest rate.
  • The “quick and easy” allure of payday loans can be one of their biggest faults. Almost any other type of loan will take time to get approved, which is a positive thing at the end of the day. It gives you time to think things over and feel absolutely sure that you’re making the right decision, rather than one made out desperation – which is when we’re prone to make mistakes. 
  • Some payday loans require direct access to your bank account. Sometimes, lenders will want to take the money for your repayment directly out of your bank account. Not only can this affect the money you have set aside for necessities like food, rent, etc., but it can incur overdraft fees if they start taking more money than you have in your account.
  • Your credit score can take a hit. Just one missed payment can stay on your credit report for up to seven years. The more missed payments you have, the greater the impact on your score, and the longer it will take to improve.

Get Alternative Help at Xpress Cash

As you can see, although the answer to “Can you have two payday loans out at once?” is yes in some states, it is in your best interest to consider other options, and Xpress Cash can help. We’ll compare alternatives like payday vs. installment loans, and help you look at your overall finances to find other solutions to your unique situation. Contact us or visit us at one of our Michigan locations to get started today!