Can I use a Payday Loan to Pay off Other Debts?

If you have debts that you would like to repay, then you may consider borrowing money elsewhere in order to do this. A payday loan such as those offered by might be one of the ways that you might be thinking about. It is worth making sure that you are making the right decision though. You need to check out the cost, risk and ease of paying off debts like this.

Cost – the cost of debt is something that you need to consider. All loans have a cost and so if you pay one off with another, then you are replacing one cost with another cost. You need to think about whether this is something that you want to do and something that will help you finances. For example, if you have a cheap loan and you use an expensive loan to repay it then you will be paying out a lot more. However, if you use a cheap loan to pay off a dear one then this would be advantageous. This means that you will need to do some maths. You will need to think about how much the current loan costs and how much the new one will cost. Make sure that you look at the fees as well as the interest rate so that you are comparing the total cost of both. It can be tempting to compare the interest rate and assume that the one with the lowest interest rate will be the cheapest. However, if there are fees or charges as well, then this may not be the case and so you need to be sure. It can be worth getting in touch with the lender to ask them about this as they will be able to explain it. Otherwise you will have to look through the terms and conditions of the loan and that is not always very easy to do, both because locating them might be tricky and because understanding them is often hard to do. You also need to think about how long the loans last as if you are only paying interest for a short period of time it will be cheaper overall compared with paying it over a longer time period, even if the amount you pay each month is less.

Risk– changing to a different loan type might be risky. Loans have different ways of operating and some are riskier than others. With a payday loan you will have to repay the amount in full after a few weeks. You may like this idea because it means that you will clear the debt really quickly. However, there is a risk because you might be repaying more in the one-off payment than you would be if you had not swapped loans. This could make it harder for you to afford that repayment and therefore there could be a risk that you will not be able to pay it and have fees to pay on top. On the other hand, you might be able to repay it, but it may not leave you with much money for everything else and you could end up looking for another loan to help you. This means that it is so important to be honest with yourself when you are working out if paying off a loan with a payday loan is right for you.

Ease – it is worth looking at the process of repaying a loan with another. You will have to apply for a new loan and then repay the old one. It will take a series of steps and therefore you will need to be prepared for this. There is a risk, of course, that you might be turned down for the payday loan and then may not be able to go with the idea. The risk is small though, as most borrowers are accepted, but there is still a risk of not being able to borrow as much as you need. You will also need to check that there is no penalty for repaying the loan early. Some lenders will make a charge for doing this but some will not. The charge can vary as well, sometimes it is just a month’s interest other times it could be a huge amount of money. It is therefore really important to find out before you apply for the payday loan as you may end up finding that you will not get enough money to be able to afford your goal.

So, there is a lot to think about. A payday loan could be a good way to repay a loan but only if it is cheaper, that you are confident you will be able to repay it and if the process is easy. It is worth considering but you need to be sure that you put in the research and that you are confident in your decision.

Am I Old Enough to Have a Payday Loan?

It can often be a worry, when you are young, that you should not be taking on too much responsibility such as a loan. It might be that you are worried for yourself or that other people are worried for you. However, it is worth thinking yourself whether you feel you are old enough or not.

Rules for payday lending

Payday lenders have a few restrictions on who they can lend to. Firstly, all borrowers have to be over the age of eighteen and so if you are younger than this then you will be too young to have one. However, any other age has no official restrictions. There are a few other rules that might affect you though. You will need a bank account and although most people do have one, there are a few people that do not and therefore you will need to make sure that you are not one of those that do not. You will also need to have a regular income. This is because the lender will want to make sure that you have money coming in to repay the loan. They will want to ensure that there is an income and will set up a repayment amount by direct debit on the day that you get paid.

Capability of repaying

Whether you are old or young, it is important to make sure that you will be capable of repaying the loan. Although this is not something that your lender will check, you need to pay it on time or else there will be fees to pay, as there would with any other type of loan. It is really important to think about whether you will be able to manage. It can be easy to just assume that you will be okay, but it is sensible to work it out properly. Get some figures together and work out how much money you have coming in and how much you have to pay out and whether that will leave enough to repay the loan as well. It is likely that you will need to cut back spending on other things so that you can afford the loan. You will need to think about where spending is a priority and what things you can cut back on. It might even be the case that you will need to look for ways to earn more money in order to repay it. This could be in the form of some freelance work, selling some things you own to make cash or something else. There will be opportunities available, it will just be a case of finding one to suit you.


Often people do get worried about young people not being that responsible. However, if you have a plan in place to make sure that you will be able to repay the loan and you stick to it, then you will have the responsibility required. You will know whether you are likely to be able to do this or not. You will know if you can commit to something and stick to it or whether you are not very good at doing this. Although you may not have been in this specific situation before, it is likely that you will have been in previous situations where you had to take responsibility for things and you will know whether you stepped up to the mark or whether it was not successful. Look back at your previous record and think about whether you feel that you can trust yourself.

Credit record

it can be a concern, that a payday loan will have a negative effect on your credit record. However, loans have varying effects on credit scores, it will depend on you as well. If you repay the loan in full, it will demonstrate that you can be trusted to repay a loan and that should be a positive thing. Obviously, taking a payday loan, which does not have a credit check, could indicate that you are struggling to find a loan elsewhere and it might make lenders think that they should not lend to you. However, showing that you can repay it on time should show them that they can trust you. However, if you do not repay on time, this will not look good at all. It will make other lenders fear that the same will happen if they lend to you. This would happen with all loans though, not just payday loans.

So, there is not an age, once you are eighteen where you will be too young to take out a payday loan. It is more about whether you can cope with the loan. You will need to make sure that you can repay it and if you need to adjust your spending and earning in order to do this, you will need to take responsibility for that. Only you know for sure whether this is something that you will be able to do.