Can I Get Multiple Payday Loans?

Authorby Ben Sweiry · Modified on 13 October, 2023

• Yes, you can get multiple payday loans at once, depending on the US state you are in.
• We advise you pay-off any previous debt from payday loans before applying for another one.
• Having too many payday loans open can be expensive and lead to a unhealthy debt cycle
• Consider other financial products, such as car title loans, if you find that your payday loan is not enough to cover your emergency bill or expense.

Can I Get More Than One Payday Loan in Texas?

There is no cap on the number of payday loans you can have in Texas. However, it is advisable to pay-off any outstanding debt you have on a payday loan before you apply to borrow money again.

However, in Texas, after repaying a payday loan, there is typically a mandatory cooling-off period of at least one business day before you can apply for a new payday loan. This rule is in place to prevent borrowers from immediately taking out another loan after paying off the previous one.

Many US states also have caps on the amount of interest that lenders are legally allowed to charge, detailed in the table below:

Should I Get Multiple Payday Loans?

It is advisable to only get one payday loan at any one time. Multiple payday loans can lead to a debt trap because they typically come with higher interest rates than other financial products, and offer shorter repayment periods.

However, with Dime Alley, we offer repayment plans that can stretch across 60 months or five years, which can be more manageable than your typical payday loans from other vendors.

In addition, if you fail to repay multiple payday loans on time, it can harm your credit score and make it even more challenging to access affordable credit in the future.

How to Get Out of a Debt Cycle

Living with debt can be overwhelming, but there are some ways to get out of your debt cycle;

1. Create a Budget: Develop a realistic budget that outlines your monthly income and expenses. This will help you identify areas where you can cut back and allocate more funds toward paying off your debts. Stick to your budget religiously.

2. Prioritize Debts: Not all debts are created equal. High-interest debts, such as credit card balances, should be your top priority. Pay the minimum on all your debts, but allocate extra funds to the debt with the highest interest rate. Once that’s paid off, move to the next highest interest rate debt.

3. Build an Emergency Fund: To prevent falling back into debt when unexpected expenses arise, establish an emergency fund. Aim to save at least three to six months’ worth of living expenses.

4. Consider Debt Consolidation: If you have multiple high-interest debts, consolidating them into a single, lower-interest loan may be an option. This simplifies payments and can reduce overall interest costs.

5. Avoid New Debt: While working to pay off your existing debt, avoid taking on new debt whenever possible. Cut up credit cards, and only use them in emergencies.

What are some Alternatives to Payday Loans?

Instead of resorting to multiple payday loans, consider these alternatives when facing a financial crisis:

1. Emergency Fund: Building an emergency fund can provide a financial cushion to cover unexpected expenses..
2. Negotiate with Creditors: If you have outstanding bills or debts, try contacting your creditors to discuss repayment options or request a payment plan.
3. Credit Counseling: Seek advice from a reputable credit counseling agency. They can help you create a budget and develop a plan to manage your debts.
4. Personal Loan: Explore personal loans from traditional financial institutions or online lenders. These loans often have lower interest rates and longer repayment terms compared to payday loans.
5. Borrow from Friends or Family: While borrowing from loved ones can be tricky, it’s often a better option than payday loans, as you may not incur interest or fees.