Have you ever been in a situation where you’re struggling to find enough money to make ends meet – yet suddenly you have extra bills to pay for?
Maybe your car failed its MOT and needs a few expensive repairs before you can get back on the road. Perhaps you accidentally put your jeans in the wash with a handful of coins and broke your washing machine.
Life is unpredictable, which means that no matter how carefully we prepare, sometimes things can go wrong, and leave us with extra expenses to worry about. Even if you have a great budgeting strategy, you might need a payday loan from time to time, to help you get by until the next time your wage goes into your bank account.
Whether you’re handling unexpected expenses, or you’re dealing with an emergency, a quick loan can be a lifeline for people who need money fast. While personal loans and other conventional lending options come with complicated application processes and lengthy waiting times, a payday loan can be delivered into your bank account within 24 hours of you making your application.
What’s more, payday loans are even there for people who might not be approved for other kinds of lending opportunities, due to poor credit history.
Although they may seem similar to a standard personal loan, payday loans are very different to most of the conventional lending options you might have used in the past. These short-term cash advances will help you to survive on a limited amount of cash before your next payday arrives. Usually, you’ll apply for your loan online with a company that has no physical brick-and-mortar store.
The application process usually takes about ten minutes, and you should get an update on your status within an hour or so. If your application is approved, you’ll be able to get the money you need to be paid directly into your bank account.
While there are some short-term loan providers who accept payments via instalment, the majority of companies will ask you to pay back your loan via an automated payment on the day when your next wages go into your bank account. This will include paying back the original money you owed, and any interest you’ve incurred.
As the payday loan market has continued to grow in the UK, various new companies have sprouted up, offering new methods to borrow money. Some organisations will allow you to pay back money in instalments; others will support people who have a poor credit history. The experience you get with your loan application will depend on the provider that you choose to borrow from.
One thing that most short term loans from direct lenders have in common is that their application process is very simple. You should be able to fill out a form online and get information on your loan within a matter of minutes. Usually, there’s no need to speak to another human being or arrange an in-person interview.
In most cases, affordability assessments and credit checks are automated with payday loans, which is one of the reasons why they’re so easy to apply for.
Remember, to make your application go more smoothly; it’s essential to ensure that you have the right information on hand for your loan. You’ll need to provide a few details about your income and expenditure, as well as your bank account details, and information about how much you want to borrow. You’ll also be required to provide evidence that you have a regular income, that you’re a resident of the UK, and that you’re over the age of 18.
A valid UK bank account is necessary, so your money can be paid to you directly when your loan application is approved.
The amount you can borrow for a payday loan will depend on a number of factors, including the lender that you choose. Additionally, most loan providers will consider how much to give you based on things like your existing credit rating, your financial history, and your affordability levels.
Your payday lender won’t want to give you more than you can reasonably afford to pay back. This wouldn’t make sense for them int the long-term. That’s why a payday provider will often check your affordability levels alongside your credit rating.
If you’re a first-time borrower, your loan amounts may also be restricted until the loan company can learn more about how reliable you are.
One of the biggest concerns that consumers have when it comes to applying for payday loans is that the interest rate on these lending solutions can be a lot higher than on traditional loans. However, like any other kind of cash advance, the amount of interest you pay will vary from one lender to the next. When you’re comparing your options, you’ll be able to get a basic insight into your interest rates by looking at a company’s representative APR.
Remember that representative APR displays the amount of money you’d need to pay if you were borrowing your money for the entire year. It’s important to keep this in mind, as usually, you’ll only be borrowing your cash for a couple of weeks or months. This means that APRs can seem scarier than they are.
A crucial thing to keep in mind these days is that payday and short-term loans are fully regulated by the financial conduct authority. To protect consumers, the FCA put rules in place to ensure that you never pay more than 0.8% daily interest on your payday loan. Additionally, FCA regulations also dictate how much you can be asked to pay for late fees too.
When you’re comparing your payday loan options, it’s worth paying attention to the rules around your repayment strategy. Some loan providers allow for early repayments, which means that there’s no extra charge on your loan if you find the cash you need faster than expected.
Additionally, payday loan companies are regulated by the FCA when it comes to late fees. This means that you can only ever pay a certain amount if you’re late on repaying your loans. However, this doesn’t mean that you shouldn’t strive to get the money you owe back to your lender on time. Late repayments can still damage your credit score.
If you’re concerned that you won’t be able to pay back your loan on time, it might be a good idea to contact the company and ask whether you can roll your loan amount over to the next month, or whether there are any other strategies you can try.
Payday loans are specifically designed for use in emergencies. If you have a sudden expense that you can’t afford to pay by yourself, and it would be dangerous to wait around to see whether you’re approved for a conventional loan, then a payday loan could be the best option.
Payday loans are also useful for people who don’t have the best credit ratings. Most companies today are willing to consider factors besides your credit history when determining whether to give you a payday loan. If your history might stop you from getting a personal loan or another form of cash advance, then a payday loan could be a useful way to get the support you need.
Payday loans give you access to quick cash when you need it most. Unlike other traditional lending options, you’ll be able to borrow the money you need quickly, often getting it into your bank account in the same day. Additionally, because you’re paying your loan back fast, there’s less of a risk that something in your life will go wrong that prevents you from making your repayments. This protects your credit history and future chances of getting high-quality loans.
Additionally, payday loans are highly flexible. Most providers won’t need to ask you a number of questions to determine whether you should be allowed a loan or not. You’re free to use the money that you borrow however you want to, as long as you can pay it back on time.
When you’re dealing with an emergency situation and you need to get cash quickly, the last thing you want is to worry about jumping through hoops with your credit provider. Payday loans can make it much easier for you to access the money you need without headaches.
Payday loans are more popular than ever in the UK.
That means that there are a large number of industry-regulated loan providers out there for the average consumer to choose from. Even if you don’t have the best credit history, you’ll still be able to select from a range of different companies to ensure that you’re getting a great deal.
Using a comparison website for your payday loan will ensure that you’re paying the lowest fees, and the lowest interest rates for your loan. It could also help you to find a more reputable company too!