Payday Loans Glossary

In an effort to make understanding the payday loan process easier, we offer the following list of commonly used payday loan terms and their definitions.

  • Approved - Being approved, in terms of payday loans, means that you have met the criteria issued by the lender in order to obtain the loan.
  • Apply - The process of requesting funds from a payday loan lender. This usually involves providing the requested information to the lender. For example, your bank statement, social security number, account number, etc.
  • Bank Statement - An official record outlining the activity of your checking account for a given period of time (usually a month), issued by your bank.
  • Borrower - Also referred to as Applicant, this is the person or group applying for a loan.
  • Borrower's Integrity - An undisclosed rating of the credit-worthiness of an applicant. Payday loan lenders use a number of factors for determining this rating, including (but not limited to) credit history and any outstanding or pending payday loans.
  • Cash Advance - Same as a payday loan, this is a provision of cash borrowed against the applicant's forthcoming paycheck.
  • Checking Account - The applicant's account with a banking institution. Lenders normally require the direct deposit feature on this account to be able to wire the funds directly into the account.
  • Credit Check - The process of reviewing information on the applicant's capability to abide to their financial responsibilities. Most payday loan lenders do not require this.
  • Direct Deposit - The common term used to refer to the process of transferring funds (making a deposit) into your account electronically.
  • Fax (Facsimile) - This is an electronic device that allows a user to issue a recipient a copy of a document as it appears via a specialized phone line.
  • Fee - Payday loan lenders normally charge a fee against the amount borrowed; the higher the amount the higher the fee. It's considerably low compared to APR charges from credit card companies.
  • Payday Loan - Like a cash advance, this is a loan taken out based on an expected paycheck that will cover the loan amount and the fees acquired with it.
  • Paycheck - The applicant's weekly, bi-weekly, or monthly income that they obtain from their employers.
  • Wire Transfer - The computerized process by which money or funds are moved from one account to another electronically. This is a very quick way of channeling money into an account.