If I take out a payday loan, could it hurt my credit?
Answer: It is possible that lenders may access your payday loan history when considering you for future loans.
Payday loan activity generally does not show up on the credit reports you get from the three major national credit reporting agencies (Equifax, Experian, and Trans Union). However there are specialty credit reporting agencies that collect some of your payday loan history. It is possible that lenders may access this information when considering you for future loans.
In addition, if you don’t pay your loan back and your lender sells your payday loan debt to a debt collector, it is possible the debt collector would report this debt to one of the major national credit bureaus. Debts in collection could impact your credit score.
Likewise, some payday lenders bring lawsuits to collect unpaid payday loans. If you lose a court case related to your payday loan, this fact could appear on your credit report and may affect your credit score.