Increasing Credit Score - Payday loans?

[Anonymous]

I've been paying off debt as quickly as possible and my score has literally not moved. It's a horribly low score that I'm too embarrassed to share. I'm no longer financially irresponsible (I was in between jobs about 4 years ago, and had a few cards that I maxed out, plus was late on car payments - completely destroyed my credit those few years). I've had counseling the past couple of years to ensure I wouldn't make the same mistakes. 

I tried for a Cap One secured card back in November and was denied (yikes). 

Now, I know Payday loans are INSANE and no one should ever get them, especially for "emergencies" - but I'm not in emergency mode right now. I just want to raise my score as much as humanly possible, and I was wondering if I had applied for a loan, then turned around and paid it off (with the money borrowed) in like 2 days...would that increase my score? Or has anyone else used payday loans to increase their credit? 

Also, I should reiterate - i don't need facts about how terrible the payday loans are. I'm merely looking for information about whether or not that would increase my score. I'd never get one if I was ever in a position that I couldn't pay it off in full right away. 

Let me kow your thoughts! 

[Anonymous]

Pay day loans don't report unless you fail to make a payment. 

[Anonymous]

Awesome! all I needed to know. thanks!! 

[boomhower]

If you have a good relationaship with your bank/CU you might try for a secured loan.  They are loans secured by either savings deposits or CD's held by the institution. 

[namvet]

Payday loans do report but not to the major credit bureaus unless yoy fail to pay.  They do report pay history to CoreLogic a Credco company.  That report contains good and bad history on payday loans as well as title loans.

[mtrsprt]

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@boomhower wrote:

If you have a good relationaship with your bank/CU you might try for a secured loan.  They are loans secured by either savings deposits or CD's held by the institution. 

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Best thing ever for building credit.  Deposit $1000.00-1500.00, take a $1500.00 loan out for 24 months.  Anything over a year is good.  Bank will report to all three CRA's.  They don't even do a credit check on you, because your securing your own loan, with your own money.

[Anonymous]

Good suggestion might be it increase your credit score but i think payday loan did not effect on credit scoring bank did not report anything until you did not pay back so try any other method to build the score.

[Shogun]

Payday loans, even ones that are paid off, seem to come back and haunt sometimes.  There are lots of posters on here that have bottom feeder CAs show up looking for money on accounts that were satisfied.  Just seems to be a "shady" business.

[TheConductor]

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@Shogun wrote:

Payday loans, even ones that are paid off, seem to come back and haunt sometimes.  There are lots of posters on here that have bottom feeder CAs show up looking for money on accounts that were satisfied.  Just seems to be a "shady" business.

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This ^^

Plus, I've never heard of a payday loan that had any way for you to avoid paying the full amount of the interest.  You could repay it 5 minutes after signing the loan papers and the interest charge would be identical to what you'd pay on the actual due date.  That's just how they are structured.  And the interest rates are ridiculous.

It's not like a mortgage or car loan where you can often save on interest by paying down the principal early.

Don't go there.  Payday loans are definitely not credit-building tools.

Best bet is to find a local credit union that offers secured loans and/or secured credit cards. 

[AndySoCal]

Even if they did report to the bureaus. The cost in $$ far and away execeed in possible points gained in your score.  My basic premise $$ saved  beats points. I would only suggest a personal if the interest on the personal loan is lower that what you are paying now on what you owe. I would use the personal monay to pay off the higher rate debt.