In times of emergencies, bank or credit union loans and credit cards might not be an option, which is why you may turn to places like MoneyKey. This small-dollar, short-term loan service offers Houston residents installment loans, which work similarly to payday cash advances.
MoneyKey does all of its business online, so you won't find any storefronts for this relatively new company. For Texans, MoneyKey works as a middleman that pairs you with a third-party lender. To get access to one of these installment loans, you pay a premium. The Credit Access Business (CAB) fee that you pay is high, which is why you pay back so much money compared to the amount of the loan. Plus, annual percentage rates (APR) associated with these types of loans are extremely high.
You're expected to pay back the loan in several installment payments over a few months, and if you need to get an extension, you usually can. However, to pay less in fees and APR, you should try to pay everything back as soon as possible.
If you compare the cost of an installment loan through MoneyKey with that of the national average APR for payday loans, which hovers around 391 percent, you'll find that MoneyKey is much higher, especially if you stretch a loan out over several months. Credit cards, pawn loans and auto title loans are significantly more affordable, so be sure you have no other avenues before you choose a payday or installment loan.
The biggest differences between MoneyKey and the payday loan companies you may see in strip malls in Houston are that you have a longer period of time to pay back your loan, and the amount you pay in fees. MoneyKey doesn't offer nearly as much information on financial health or credit health as other companies, but the law requires it to be clear about its fees, and it is. You don't have to hunt too hard on its website to find out exactly how much you have to pay for a loan.
MoneyKey works a bit differently than most payday loans in Houston because it offers installment loans. The loans are small-dollar amounts, but you have up to 180 days to pay everything back. As a CAB, MoneyKey charges high fees to you, separate of the interest rate you pay for the loan.