Loan Types, Entered in Full
Five loan types, cataloged the way an auditor would — how each works, what it typically costs, and who it tends to fit. Reference material, not a recommendation of any one type.
Payday Loan
A short advance against your next paycheck, usually repaid in one lump sum on your next payday. Approval is fast and often doesn't require a credit check, which is part of the appeal — and part of the risk.
- Typical APR
- 300% – 400%+
- Typical fee
- $10–$30 per $100 borrowed
- Rollover risk
- High — fees compound quickly if extended
- Best fit
- Genuine one-time gap, repaid in full next check
- Watch for
- Automatic rollover clauses, post-dated check requirements
Installment Loan
You borrow a fixed amount and repay it in equal scheduled payments over months, not weeks. Costs vary enormously by lender — some are reasonable, some carry payday-level APRs dressed up in a longer term.
- Typical APR
- 25% – 200%
- Common add-on
- Origination fee (1–10%)
- Rollover risk
- Low — fixed schedule, but refinancing resets costs
- Best fit
- Larger, planned expense with a repayment plan you can sustain
- Watch for
- Prepayment penalties, add-on insurance products bundled in
Title Loan
Uses your vehicle's title as collateral, so approval doesn't depend on income verification the way many loans do. The trade-off is real: missed payments can mean repossession.
- Typical APR
- 200% – 300%
- Collateral
- Vehicle title (car must usually be paid off)
- Rollover risk
- High — repeat rollovers are common
- Best fit
- Rarely the lowest-cost option; consider it only after ruling out alternatives
- Watch for
- GPS/starter-interrupt devices, balloon payments
Cash Advance App
Advances a portion of income you've already earned but haven't been paid yet. Structured around optional tips or flat membership fees rather than traditional interest, which can make true cost harder to compare.
- Typical cost
- $1–$14 flat, or optional "tip"
- Effective APR
- Can be low to very high depending on tip amount and advance size
- Rollover risk
- Low — tied directly to next paycheck
- Best fit
- Small, short timing gaps between paychecks
- Watch for
- Subscription fees, "optional" tips that function like interest
Line of Credit
A pool of credit you can draw from as needed, paying interest only on what you use. More flexible than a lump-sum loan, but the open-ended nature makes it easy to underestimate the running total.
- Typical APR
- 20% – 36%
- Structure
- Draw, repay, redraw within a credit limit
- Rollover risk
- Moderate — balance can grow if only minimums are paid
- Best fit
- Recurring or unpredictable expenses over time
- Watch for
- Annual/maintenance fees, variable rate terms
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