Will a payday loan hurt or help my personal credit score?

It may affect your score, but it is dependent on several factors. A payday loan shouldn't affect your credit negatively, unless you fail to pay, and may even affect your score positively if you do. If you take a payday loan and don't repay it on time, than just as with any type of loan, your credit score will suffer accordingly. So be sure that you are certain that you can repay the loan in a timely manner before you take one out.

During the duration of the loan, other lender's may not be as willing to give you further loans, since you are already paying back a loan, but this situation will rectify itself automatically as soon as the loan is paid.

Once you finish paying the loan, your positive credit history should affect your credit score positively, since credit that you pay off on time is good for your credit score. So the score that is reported to the agencies will automatically reflect your new improved score.

Sometimes it has no effect:

Normally the lender will send a report with your loan information to the credit agencies every month, but depending on the lender, they may or may not do it differently. So you might take out a quick loan, and pay it back before the lender sends in a report, and in this case your loan wont make the monthly report, and your credit score wont be affected. If you are worried about this happening, discuss it with your lender to be sure that his reports will include your loan history.

Where do Credit Checks fit in?

Many payday loan's don't require a credit check at all, in which case you won't have to worry about them. But if your loan application does require a credit check, the ding may slightly harm your credit score, the difference should be negligible, but if you apply for many loans in a short period of time, the credit check dings could add up to something significant.

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