Taking Out A Payday Loan: Is It Right For You?
Payday loans can prove a fantastic way of getting your hands on some extra cash when your finances just dont cut it in a given months
. For instance, perhaps you can normally keep abreast of your income and expenditure, but this month both your boiler and your car need repairing. These are both essential items, you need to fork up the cash or suffer, but if you dont have the cash, clearly, it is much harder. What do you do? Well, you have a few options: ask friends and family, ask your bank, dont fix your one or other problem, or get a payday loan. You can probably see the problem with each of these solutions, but the least painful option would, in most cases, be a payday loan.Payday loan lenders online have been getting a bad press lately, and this is largely because of the astronomical APR. However, APR is something by which you shouldnt judge a payday loan. This is because they are short term loans, rather than long term loans. The money is repaid within a month, and so the APR is misrepresentative of the cost of the loan. Instead, lenders tend to offer a flat rate per amount borrowed; for instance, 30 per 100. Sure, if you were to take that as a percentage rate over a year, then it would be immense, but it is not, instead, it is the flat rate paid on borrowings.
There are still a number of things that you should keep in mind when taking out a payday loan:
* Payday loans are quick and convenient to obtain. It takes a matter of minutes to complete an online application form, and a few seconds to find out if you are eligible or not. The money will be deposited into your account within three working days if you accept the loan and are eligible.
* There is a limit to the amount of money that you can borrow. This is because there are risks inherent in this type of lending. The maximum amount that you can borrow is, on average, 750.
* You will need to be at least 18 years old, have an active bank account based in the UK, and be in full time, paid, employment. Furthermore, you salary must be paid into your UK based bank account.
* You can get extensions on a payday loan, so that if you do find that you are struggling to meet the repayments, you can roll the loan over to the following month. The only stipulation is that you repay the interest.
* Unlike the mainstream banks, a payday loan lender will never ask you why you need to borrow the money. As long as you can show that you will be able to meet the repayment schedule that is all they ask.
* You do need an adequate credit score in order to obtain a payday loan, so they are much easier to get. However, this should mean that you exercise greater caution when taking out a loan; being especially careful that you can make the repayments as necessary.
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