Need Extra Cash? Uk Direct Payday Lenders Can Help

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Short term loans, or payday loans, have become more and more popular in recent years

. What started off as an American system is now common in the UK too, with many people taking out small loans to tide them over a difficult month or help meet a hefty and unlooked for expense.

The idea of a payday loan is that the borrower applies for a small amount (usually below 500), and promises to repay it within a month (or when the next pay cheque arrives.) If the lender approves the loan, the cash is transferred pretty sharpish to the borrowers bank in less than 24 hours, with some companies offering transfers in as little as 15 minutes.

In the UK there are two ways of getting a loan of this type directly, or indirectly. In direct lending, borrowers apply straight to the company and the company either approves the loan and provides the cash, or refuses it. Indirect lending involves a middleman a broker who acts as a go-between for the borrower and the lending company.

Now that so many direct payday lenders operate online, many customers prefer to go straight to the lender without using a broker. This generally works out cheaper as a broke will charge commission for his services. Borrowing via a direct lender is also quicker, as the whole process can be undertaken online and many companies offer instant decisions about whether or not to offer a loan.

The advantage of brokers is that they are able to check with lots of different companies for the best deals, and in some cases you are more likely to be accepted for a loan if represented by a broker. However, direct payday lenders in the UK are under obligation to state their interest rates upfront, so its fairly easy to compare various lenders for the best deals yourself.

Whichever option you prefer, make sure you understand how much youll be charged and when. Payday loans can be a great option for people with a steady income who just need a little extra on rare occasions, but be warned: they are short term solutions only and not designed for long term or large scale debt management.

by: Phoenix Payroll Ltd

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