If you live off of government benefits like supplementary security income (SSI) or social security and don’t have a formal job, you may be wondering if payday loans are available to you.
The truth is there are payday loans for SSI recipients, and people who participate in other government entitlement programs.
You may be considering this as an option if you incurred a sudden expense, are looking to avoid making a late payment or otherwise need money fast.
The fact remains if you are receiving government entitlement checks as your sole source of income, you could be eligible to take out a payday loan. Here’s why:
What Is Alternative Income?
Alternative income, in this context, is any reliable income outside of job revenue. This sometimes comes in the form of entitlements like disability or social security income in the form of SSI.
Supplemental security income, or SSI, is a form of incremental income issued by the government to qualifying adults who cannot work due to age, disability or other varied of reasons.
SSI is paid monthly, on the first of each month, to blind, disabled and elderly individuals who qualify for benefits.
What Lenders Accept Alternative Income?
Not every lender will accept forms of alternative income as a valid income form to lend against. So getting payday loans for SSI recipients means bringing your business to the right lender.
Here is an inclusive list of lenders that are likely to accept forms of alternative income when making cash advances:
- ACE Cash Express
- Advance America
- Cash Central
- Check City
- Check into Cash
A determination is made about each borrower based on certain requirements at the time of application. Partnering with an online entity can help you find a favorable payday loan available from a number of lenders.
Requirements: Payday Loans for SSI Recipients
Three main things are required if SSI recipients are to qualify for a payday loan:
- Proof of SSI income: usually in the form of a letter sent to the recipient.
- Bank statement of account in good standing: you will need to have a checking account in good standing with your bank
- A photo ID
You can apply on-location at a number of places, or go online to see favorable offers on payday loans that make sense for you.
Why Pay Day Loans with SSI Benefits?
At this point, if you’re considering a cash advance you may be wondering what are the benefits of payday loans with SSI benefits?
Here’s your guide to navigating the pros and cons of paydays loans:
The government schedules payments to SSI recipients, and others who receive monetary benefits, on an ongoing cycle that starts with a payment on the first of each month.
If you have an accident and receive an unexpected medical bill on the 15th, an advance on your payment may be just what you need.
Payday advances are:
- Available at most financial institutions and online
- Not hard to qualify for; and
- Speedy delivery
With high-availability online and in stores, and a short list of requirements, payday loans are a fast, convenient and all-around accessible way to get the money you need.
Minimums and Maximums are Variable
While most payday loans are relatively small and exist within a given monthly salary, the amount that you qualify for is often times variable.
That means lenders can grant you a larger amount of money on subsequent transactions when you payback payday loans with SSI benefits.
Can Assist with Credit Health
If you have bad credit and there’s an emergency, a payday loan may be one of only a few options you have to make a tenuous financial situation right again.
Luckily, a bonus of this type of loan is that it can be beneficial to your overall credit health.
Personal installment loans are usually paid back over a year or longer. That leaves a lot of time for financial problems occur that may cause you to default. Defaulting on a personal loan is bad for your credit, naturally.
But since payday loans are usually paid back in full on the next pay cycle, there isn’t as much opportunity for the relationship with the lender to go south.
It may not give you the same boost that paying off a credit card or car payment does, but when taken out responsibly payday advances aren’t as likely to hurt your credit as other loan types.
And, when used strategically, could help your credit by preventing the kind of damaged financial situation that would otherwise drop your credit score.
Drawbacks of Payday Loans with SSI Benefits
While there are some ways people use payday loans to get ahead, there are also some potentially harmful obstacles and drawbacks. Here are some things to consider when deciding on a cash advance option:
- These loans are not for everyone
- They have high penalties
- Some lenders aren’t willing to work with SSI
- Can damage your credit if used incorrectly
- Some lenders have hidden fees
Not For Everyone
Something important to understand is that payday loans are not for everyone.
Taking out a cash advance is a big responsibility. If your alternative income is not reliable or you don’t have the funds to successfully pay back a payday loan in full. You may want to reconsider.
Only people who can reasonably pay back a payday advance without serious hardship should be looking at this option for emergencies. Once granted, a payday loan must remain a priority and be treated like an important responsibility.
Payday loans are usually high-interest loans that come along with a number of other fees and penalties.
One drawback of taking out a payday loan is paying back the amount borrowed plus interest and fees, and any penalties should you default. The whole process can get expensive.
Some Lenders Reject SSI
Qualifying for a payday loan can be a challenge for some SSI recipients because there are lenders who only accept more traditional forms of income on advances.
That’s why we provided a list in this article, and recommend that you reach out to our trained staff to see what favorable options are available to you.
Damage to Credit
As with any loan, defaulting on a payday advance can damage your credit. If you are getting a payday loan because you already have a poor credit rating, further damage can be a big deal.
Some lenders offer payday loans that are lousy with hidden fees. If you are a borrower make sure to review all of your options, including the fine print to avoid biting off more than you can chew, financially.
Tips: Cash Advances and Alternative Income
If you’re still thinking about a payday loan. Here are a few tips to help you along the way:
- Consider all your options: using a service like Bonsai Finance, you can review side-by-side payday loan options
- Look for hidden fees: read the fine print to ensure all fees are within your budget — some companies charge upwards of 300% interest on the defaulted loan as well as other fees
- Know how it impacts SSI income: if you take a loan out and spend it all on emergency medical, and none of the cash advances remains at the next pay period, you are within your rights to do so — but if any income remains it has to be reported and your SSI benefits may decrease to make up the difference
Make sure to consider all of your options before signing on to a cash advance loan.
Payday Loans & SSI
There are a number of ways borrowers can get payday loans for SSI recipients, but the most important thing to remember is to shop around.
Lenders offer different rates and terms. And some of the fees can be very steep and cause financial turmoil on those who unexpectedly default on payment.
To avoid having legal complications and damaging your credit on payday loans with SSI benefits, it’s always advisable that you only take out a loan if you can truly pay it back.
Payday loans are not for everyone. They come with high penalties and can sometimes do more harm than do.
The decision is yours on whether or not to take out a payday loan, but getting started with Bonsai Finance helps you find the courage to take the first steps toward possible approval.
For more information, contact Bonsai Finance today or submit your request today.