Payday loans can be a difficult thing. The fact of the matter is that, while the actual fees charged for a payday loan aren’t all that high, the interest rate is extremely high when compared with other forms of borrowing. Add to that the fact that many people find themselves stuck in a vicious payday loan cycle where they have to take out the loans again and again and again, and it can be extremely frustrating.

Some people think that stopping payment on their payday loan check is a way to end the cycle. The payday loan company won’t be able to cash the check, and they’ll have to try to collect their money another way. While it will hurt your credit report, you justify stopping payment by telling yourself you’re going to save money in fees.

Here are some things you need to know about stopping payment on a check, before you decide to go this route:

• Stopping payment doesn’t cancel your contract to repay the loan. This is an important point. You will still owe the money, and the payday lender can come at you with civil action if you do not.
• You should notify your bank that you want to stop payment prior to the date on the check. Make sure you notify the bank both verbally and in writing.
• There will probably be a fee to stop payment. The fee is usually about the same as a bounced check fee. You’ll need to provide your bank with the check number, date it was written, who it was written to, and the amount of the check.
• The order to stop payment may only last six months. This can vary from one state to the next and from one bank to the next. You may be able to ask your bank to restore the funds and return the check if a check older than six months comes through, however.
• Check state laws. Some states may put you at legal risk if you stop payment on a payday loan check. Alabama and Alaska let the payday lender pursue criminal action if you don’t make good on the check and close your bank account. In Utah, the lender can sue you for damages if it cannot make good on the check.

Make sure you thoroughly consider your situation before you decide to stop payment on a payday loan (or any other) check.