If you suddenly find yourself needing to get hold of a small sum of money when met with an unexpected financial outlay instant payday loans may be suitable as they offer fast financial help. Loans such as these are different from personal or secured loans as they typically have an extremely fast application and provide funds quickly. This is exactly what is needed when faced with a bill or repair that you do not have the money for until your next payday.
Some important points to think about when considering payday loans are:
- Applying for the loan with an ethical lender;
- Whether you can afford to repay the loan on your payday;
- You understand the cost of borrowing with the payday loan;
- This type of loan should only be considered if you need just a small sum of money to provide fast financial help;
- Whether a short term loan might be more suitable than a payday loan;
- You have enough disposable income;
- You are eligible to apply for a loan in the UK.
To be eligible to make an application for a payday loan you need to:
- Live in the United Kingdom;
- Be at least 18 years of age;
- Have an income coming in each month on a regular basis;
- Have a debit card in your name linked to your bank account;
- Be sure a direct debit can be set up on the bank account.
Payday Loans Are Emergency Loans
Payday loans are easy to apply for but should not be taken out on a whim. There is no getting away from the fact that they are among the most costly ways of borrowing, but on saying that they do provide fast financial help when it is most needed.
If you find yourself facing an unexpected outlay the payday loan can really come into its own providing you know without a doubt that you can repay the loan on the date or dates that you agree with the lender.
The funds from a payday loan can often be paid into the bank account you gave the details of in as little as a few hours after applying, which is why they get the name instant loans.
Situations Where Payday Loans Might Come in Handy
Any situation you find yourself in that leaves you needing a small cash of money when payday is some time away might be when a payday loan is suitable. There are some instances listed below but they are by no means the only reasons.
- You are looking at having high fees taken by your bank after your account has gone into an unauthorised overdraft;
- You forgot about a direct debit that is going out of your bank in the next few days and you don’t have the funds in the bank to cover it;
- You got a flat tire and need to have it repaired or buy a new one;
- Your vehicle has broken down and it has to be recovered to a garage and repaired;
- An appliance such as your cooker or fridge has broken down and needs repairing.
Situations Not Suitable For Payday Loans
Some situations are not suitable for applying for a payday loan and these include:
- You are struggling from month to month, often running out of money and you are considering taking out payday loans from month to month;
- You are considering applying for a payday loan to pay off another payday loan that you are struggling to repay;
- You know that you will be left short of money on your payday when the lender takes their repayment back;
- You need to borrow more than £500. In this case, you might be better off applying for a short term loan.
Terms of the Payday Loan
The usual term of the payday loan is between one month and three months. As with any other type of loan, the least amount of time you take the loan over, the less it will cost you in total.
All loans have an APR attached to them, which is the annual percentage rate. This is the rate of interest you would pay back over the year on a loan. While a personal loan taken out over many years might pay in the region of 29.9%, the payday loan is usually listed in the thousands of percent. This is the rate you would pay over the year but you are not taking the loan out for a year, just a month or two.
Lenders will generally offer you cash sums between £100 and £500 but this may differ between providers with some offering more. It is important that you never borrow more than you actually need, to keep the costs of borrowing down as much as possible.
Do Instant Payday Loans Require A Credit Check?
Lenders in the UK are required to look into your credit past when you apply for a loan but when applying for a payday loan they are generally more lenient. Some may perform a soft check. This means they do not look too deeply into your credit file and your credit file is not the sole source of information that goes towards them deciding if you can borrow.
We are not lenders ourselves. We work to match people looking to borrow with suitable instant payday loans offered by a panel of UK lenders. This way, people looking for instant loans that pay out cash fast do not have to make multiple applications with different lenders, which usually affect your credit score negatively.
Lenders Focus More on Affordability than Credit Ratings
While there are some lenders out there who will only consider your credit score when deciding whether to offer a loan or not, the payday lenders we work with do not. Yes, some lenders do realise that your circumstances might have vastly changed from when you earned a poor credit rating some years ago and are willing to give you a chance.
Lenders will consider your circumstances when you apply for a payday loan. This means they will check on the affordability of the loan. They do ask you to provide information about the money you have coming in every month and what you pay out.
You will have checked your own financial situation to ensure you can afford to repay the loan and the lender will do the same. Providing you have enough spare money each month after paying your other outgoings, the lender will more than likely consider that you can repay the loan. Bear in mind, the sum of money is small in the grand scheme of loans and you are going to pay it back quickly, one to three months.
Instant Short Term Loans
There is another type of loan classed as an instant loan and this is a short term loan. The criteria for applying for the loan is the same as with the payday loan but there are big differences that set it apart from a payday loan.
With the short term loan, lenders will generally offer between £500 and £1,000. This can be a suitable alternative to the payday loan if something major comes up and you do not have the money to cover it.
As with a payday loan, the short term loan can be applied for quickly, it comes with an instant decision and money is paid directly into the bank account of the borrower fast.
Another difference between this and the payday loan is that the term of the loan can be spread out longer than three months but not as long as with a personal loan. Lenders usually allow borrowers to spread the cost of the loan for up to one year.
Making Your Loan Application
It is extremely easy to apply for payday loans online with our help. We need just a few details from you to be able to search for a lender offering a loan that is suitable to your needs and circumstances. Lenders consider your current circumstances and ability to be able to repay the loan, so you can apply even if your credit score is less than perfect.
Step one – fill in your details
Step two – we try to match you up with a lender from a panel of lenders
Step three – you can check out the details of the loan with the lender to ensure it is suitable
Step four – sign up for the loan
Step five – the money is paid into your account.
Instant payday loans can offer fast financial help if something unexpected crops up and your payday is some time away. The lenders we work with offer numerous loan options, competitive rates and loans that are affordable, even to those with a poor credit history. Payday loans can be a lifeline providing you understand what is involved with the loans and the loan is affordable. We help to bridge the gap between people looking for quick loans and lenders in the UK.