Payday Loan: What It Is and How It Works

Picture this – you just got paid and that money went to a handful of bills, groceries, and your kid’s upcoming class trip that you just found out about! Then wouldn’t you know it – plot twist – your car breaks down.

Sound familiar? You’re not alone. Adulting sometimes means that the timing between unexpected expenses and the arrival of your next paycheck doesn’t quite line up. That’s where short-term loans like a payday loan can come in handy. But what is a payday loan? It’s a flexible option that helps you stay on top of your expenses – surprise or otherwise - with ease and confidence.

Here’s everything you need to know about how payday loans work and whether one might be a good fit for you.

A payday loan is a short-term, small-dollar loan that helps bridge the gap between “when you need money” and “when you get money.”  So, if it’s Tuesday when an unexpected expense hits and you don’t get paid until Friday, a payday loan is like a financial bridge to carry you through the end of the week. Put simply, a payday loan gives you more control over the timing of your cash flow. You can get the cash you need quickly and, once you get paid, simply pay back the loan principal plus a fee). Easy peasy.

Here’s how a Moneytree payday loan works:

1. Apply – Complete an online application or visit a local Moneytree branch.
2. Provide Basic Info & Docs – Requirements may differ depending on your state, but in general here’s what you’ll need: Valid ID, Social Security Number (ITIN or Alien ID), documents to support your proof of income, an open checking account, and contact information.
3. Get a Quick Decision – Applications are reviewed and you get your qualification determination quickly.
4. Receive Your Funds – If approved, you can choose to receive your funds in a Moneytree branch or have them deposited to a qualified debit card account with our convenient Instant Funding* option.
5. Repay the Loan – The amount you borrow, plus the fee, will be due on your next payday.

Payday loans are used for a wide range of expenses, planned or unexpected. Here are some common examples:

• Transportation Costs – Handling routine maintenance or an unexpected car repair between paychecks.
• Bill Timing – Covering expenses that come due before your next payday.
• Personal or Family Expenses – needs that arise suddenly.
• Medical Expenses – Taking care of unplanned healthcare costs like urgent visits or prescriptions.
• Income Gaps – Bridging shortfalls when pay is delayed or varies from week to week.

If you’re looking for a short-term loan to manage your budget between paychecks, a payday loan may be a convenient option. As with any financial product, it’s important to make sure it fits your needs and that repayment on your next payday works for you.

• Quick and Easy Process – Apply online or in person with a simple, streamlined process.
• Instant Funding Available – Your funds can be deposited to your qualified debit card account.
• Licensed & Trusted – We’re a licensed, direct lender with decades of experience.
• Clear Terms – You’ll always know exactly what you’re agreeing to—no surprises.
• Friendly Service – Our team is here to support you with helpful, approachable service every step of the way.

When you need financial flexibility, Moneytree is here to support you with fast, friendly service and clear terms.

Apply now** or visit your nearest Moneytree branch to get started.

Learn more about Moneytree and our products and services by visiting the What We Do section of our blog.

*Instant Funding is not available for all debit cards. Subject to limitations. Some restrictions may apply. Processing times vary. In most instances funds are transferred in approx. 30–45 minutes, but can take longer. Moneytree is not responsible for bank, processor, and other third-party posting delays or errors.

**California and Idaho: Subject to eligibility and qualification requirements. Your account balance with Moneytree must be current and in good standing.

Nevada: Subject to eligibility and qualification requirements. Your account balance with Moneytree must be current and in good standing. Your ability to borrow and the amount you can borrow may be impacted based on information in a state database about your borrowing activity with Moneytree and other lenders licensed under Nevada Revised Statute, Chapter 604A.

Washington: Subject to eligibility and qualification requirements. Your account balance with Moneytree must be current and in good standing. Your ability to borrow and the amount you can borrow may be impacted based on information in a state database about your borrowing activity with Moneytree and other lenders licensed under Revised Code of Washington, Chapter 31.45.

CUSTOMER NOTICE: There are a wide variety of financial products available in the marketplace, so your choice should match your financial needs. Small-dollar loans used over a long period of time can be expensive.

Licensed by the Department of Financial Protection and Innovation pursuant to the CA Deferred Deposit Transaction Law to make consumer loans.