Payday Loans in Washington: Laws, Costs, and Your Options (2026)

Payday loans in Washington are legal and licensed under the state’s small loan law, chapter 31.45 RCW. You can owe no more than $700 or 30% of your gross monthly income across all lenders, the fee tops out at $95, the loan must end within 45 days, and no one can take more than eight small loans a year. Washington also gives every borrower something most states do not: the right to convert a loan to an installment plan at no extra charge. This page covers what the law allows, what a loan costs, your rights, and which of the lenders we review serve Washington. For how Washington compares with every other state, see payday loan laws by state.

Washington payday loan rules at a glance

Rule	Washington
Legal status	Permitted, through a DFI-licensed lender with a small loan endorsement (RCW 31.45.073)
Regulator	Department of Financial Institutions (DFI), 1-877-746-4334
Maximum loan	$700 or 30% of gross monthly income, whichever is lower, across all lenders at once
Fee cap	15% of the first $500 and 10% of principal above $500; $95 on $700
Due date	On or after your next payday, or your second payday if the next is within seven days
Maximum term	45 days, unless both sides agree to extend it with no added fee or interest
Loans per year	Eight at most from all lenders in any 12-month period
Installment plan	Yours on request, at no added cost: 90 days minimum up to $400, 180 days above $400
Right to cancel	Until close of business on the next business day, at no cost (RCW 31.45.086)
Collateral	One postdated check per loan; no other property or title may be taken
Online lenders	Must hold a Washington endorsement, or the loan is uncollectible (RCW 31.45.105)
Criminal threats	Banned; collection contact limited to three times a week
Military borrowers	36% federal MAPR cap under the Military Lending Act

How a Washington payday loan works

You give the lender one postdated check, or its electronic equivalent, for the amount borrowed plus the fee. The lender pays you the money and holds the check until the due date, which must fall on or after your next payday; if your next payday is within seven days, the due date moves to the payday after that. No loan can run longer than 45 days unless you and the lender agree to extend it without any added fee or interest. The lender cannot take your car title or any other property as collateral.

Before lending, the lender checks a state database that tracks how many small loans you have outstanding, whether you have reached the yearly limit, and whether you are in an installment plan (RCW 31.45.093). The application itself must warn you, in at least 12-point type on the front page, that if repaying would leave you unable to pay other bills, you should go into the installment plan.

What a payday loan costs in Washington

The fee is capped at 15% of the first $500 and 10% of anything above that, and the cap covers interest and fees combined:

Loan amount	Maximum fee	APR over 14 days	APR over 45 days
$300	$45	About 391%	About 122%
$500	$75	About 391%	About 122%
$700	$95	About 354%	About 110%

The APR columns are our own arithmetic, not a quote; your Truth in Lending disclosure states the actual APR. A longer term lowers the APR but not the dollar fee.

The eight-loan limit caps how much repetition can cost: eight $700 loans in a year would cost $760 in fees, and the law stops a ninth.

If you cannot repay: the installment plan

This is Washington’s strongest protection. If you tell the lender you cannot repay, or will not be able to, the lender must tell you about the installment plan and must set one up if you ask (RCW 31.45.084):

• No added cost. The lender cannot charge any fee, interest, or other charge for converting the loan.
• Time to pay. The plan spreads the total you owe over at least 90 days for a loan of $400 or less, and at least 180 days for a larger loan.
• Your check back. The lender must return the postdated check you gave for the original loan.
• Early payoff. You can pay the plan off at any time without penalty.

If a check under the plan bounces, the lender cannot charge a fee for it; if you default on the plan, it can charge a one-time $25 default fee. While you are in a plan, no lender can make you a new small loan until the plan is paid or two years have passed.

Your rights at the counter

1. A licensed lender. Confirm the license at dfi.wa.gov or 1-877-746-4334. An unlicensed online lender’s loan is uncollectible and unenforceable under RCW 31.45.105.
2. A capped loan and a capped fee. No more than $700 or 30% of your gross monthly income across all lenders, and no more than the fee above.
3. Eight loans a year. No lender can make you a ninth small loan within 12 months.
4. A no-cost installment plan. Ask for it before the due date.
5. Next-day cancellation. Return the principal by the close of business on the next business day and the loan is rescinded at no cost.
6. Collection limits. The lender cannot threaten criminal prosecution, visit your home or job uninvited, or contact you more than three times a week, at work more than once a week, or at home between 9 p.m. and 7:30 a.m. (RCW 31.45.082).
7. The federal Truth in Lending box. The APR, finance charge, amount financed, and total of payments must be disclosed before you sign.

What happens if you cannot repay

Ask for the installment plan first, before the due date. If your check is returned unpaid, the lender may charge a one-time fee set by DFI rule and can sue on the check, but it cannot collect attorney fees or added interest or damages under the bad-check statute, and it cannot threaten prosecution. Read what happens if you default on a payday loan for how collection works, and how to escape the payday loan cycle if one loan keeps leading to the next. If the real problem is a bill you cannot cover, start with what to do when you can’t make this month’s payment. To complain about a lender, file at dfi.wa.gov or call 1-877-746-4334.

Alternatives worth trying first in Washington

These are roughly cheapest first, with the payday loan last for comparison:

Option	What it costs	The catch
Payment plan on the bill itself	Often nothing	You have to ask before the due date
211 referral to rent, utility, or food help	Nothing	What is funded varies by area
Federal credit union PAL I	Up to 28% APR plus an application fee of up to $20; $200 to $1,000, 1–6 months	One month of membership first; one PAL at a time
Federal credit union PAL II	The same caps; up to $2,000, 1–12 months	Not every federal credit union offers one
Washington payday loan	$95 fee on $700, up to 45 days (above)	About 110% APR over 45 days; eight loans a year at most

The credit union limits come from federal regulation (12 CFR 701.21(c)(7)): no more than three PALs in six months, and no rollovers. Call 211 to reach the local referral line. Employer pay advances and earned-wage apps cost more than their small fees suggest; payday loan alternatives that actually work has the numbers for each option. If an installment loan is on the table, installment loans vs. payday loans explains how to compare total cost.

If you do borrow, borrow the smallest amount, take the latest due date allowed, and confirm the lender’s DFI license before you sign.