A Guide To Payday Loans
When you need a small amount of money to get you through to the end of the month when you expect your salary, the best option that you may have is to take out a payday loan. This is a short-term, unsecured personal loan with a term of less than a month. Depending on when the loan is taken out, the term can be a couple of days or several weeks.
For instance, if you exhaust your salary on the 10th day of the month, you can take out a payday loan on that day and repay it within the next three weeks when your salary is credited to your account. You can also take out a payday loan a day or two before you get your salary to cover your living expenses as you wait for your monthly pay. That said, there are many companies offering payday loans in the UK nowadays, so you have many options.
How to Apply
To apply for a payday loan, the first thing you need to do is find a suitable lender. You can search the internet for the best lenders of payday loans. Some of the key factors to consider when comparing lenders include; pricing structure, loan limits, processing speed, and terms and conditions of the loan. Priority consideration should be given to firms that charge the lowest fees, but can approve the loan amount you need no matter how small or how large it is.
Most firms can lend as little as £50 or as much as £1,000. However, some lenders can approve bigger loan amounts depending on the ability of the borrower to repay. The processing speed of a lender should also be fast because you expect to get your loan to be approved instantly and funds disbursed within the hour.
Before you submit your application, it is important you read the terms and conditions that come with the loan. Be sure to check for any rollover fees or penalties the company may charge when the loan is not paid off on the due date. You may also be interested to know if there are any hidden charges. After all, you do not want to get less money than what you applied for.
After finding a suitable lender, you can visit their website, go to the payday loans page, complete the loan application form online and submit it. If approved, the money will be sent to the specified account within an hour. Consequently, a standing order will be put on your salary account to ensure the outstanding balance will be recovered automatically when your salary is credited to your account.
Important Points to Note About Payday Loans
Unlike secured loans, payday loans do not require any security. As long as you have a source of income, you can get a payday loan. Your credit history will be checked, but not for purposes of approving or rejecting your application.
This is usually meant to assess your ability to repay the loan amount you are asking for. If your salary is not enough to service the loan comfortably, the lender may offer a lower loan amount than what you need. In case you lose your job, or you change your salary account to avoid paying back the loan, the lender will report you to the credit reference bureau. As a result, your credit rating will be adversely affected.
How to Settle Your Bad Debts
If you have unsecured loans, payday loans, bad credit loans, balances on several credit cards, bridging loans, short term loans, doorstep loans, car loans, guarantor loans or home improvement loans that you have defaulted on, or are about to default on, you may want to consider using debt consolidation loans to settle these debts. This is because keeping up with multiple loan payments with different due dates can be quite a challenge.
By consolidating these debts, you can take out a larger loan and settle the outstanding balance. You will then have a single loan with affordable monthly instalments, a convenient due date and a lower rate of interest. In addition to helping you settle your debts, the debt consolidation loan will also help you build your credit. All you need to do is service the loan as expected without defaulting on a single payment.