Do payday advance loans as seen on TV and the Net help with credit at all?

Question

Do they report to the major credit companies?

Answer 1

I strongly recommend against using payday loans. Their interest rates are extremely high, and the Fair Isaac Company (FICO) scores these loans as derogatory. That is, they look bad on your credit history.

To give yourself a better idea of how bad payday loans are, see the source, below.

Yes, some payday loan companies report to the 3 major credit reporting agencies (CRAs). You'd have to call the payday loan company directly to find out to which of the 3 CRAs it reports.

10% of your score is on credit mix. The good types of credit are mortgage, secured car installment loan, prime (unsecured) major credit card (MC, V, AmEx, Disc) and store cards (Macy's, Home Depot, etc.). The bad types of credit are payday loans, personal-finance loan accounts for purposes of cash advances, still-secured credit cards and overdraft loans. Ideally, you want to have at least one account for each of the good types of credit. Close the last account in one of the good types of credit, and down goes your score.

In conclusion, there are better ways to establish credit than payday loans, and by not using a payday lender, you'll save money.

Answer 2

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RE Do payday advance loans as seen on TV and the Net help with credit at all?

Do they report to the major credit companies?

Answer 3

God no.....don't do it!! My fiancee and I did it and we borrowed $700 and had to repay $950. They don't report to credit bureaus if you repay - only if you don't. The sad thing is usually if you take a payday loan, you are in hard financial times and they make it so incredibly hard to repay - they want it back so quickly. Some people take another payday loan to pay their first on and so on. It is such a vicious cycle. I'd rather be late on some bills than be stuck with that loan!

Answer 4

Using payday loans have a negative, not positive impact on your credit score. They show as revolving open household credit accounts and can do serious damage if they are not paid on time. They are reported to credit agencies.

Answer 5

Whether or not they report payments to the credit bureaus, payday loans nearly always RUIN your credit. The are designed to trap you in debt up to your eyeballs while generating insane fees.

Answer 6

Loans with a payback less than six months cannot help your credit, and Payday loans fall into that category. They can (as many have already pointed out) hurt it, not to mention sink you into debt.

Answer 7

From personal experience, stay away. The only time that they report anything is when it is not good for you. When you ask for a good standing credit report letter or anything from them, they tell you they don't report it to the bureau. They charge you way to much interest, to get nothing in return.

Answer 8

Most of these guys don't report to the credit bureau unless they're reporting a collection problem.

Answer 9

No -

Have you tired a credit card, or secured credit card incase of emergences

Answer 10

I dont think so but I wouldnt use them b/c they charge mega percentages on the advance like 20/30 percent