Things to do When Applying for a Payday Loan
Taking out a payday loan can be a fast and easy way to secure financial help for temporary cash flow problems. They are a viable form of credit for so many people that might not have been in a position to be able to borrow money for a more conventional ‘high street’ lender.
Below are some handy tips to think about when putting in an application for a payday loan.
Thoroughly Research Your Potential Lender
Before you sign up for any loans, it’s always advised to ensure that you are getting credit from a respectable loan company like simplepayday.co.uk. One of the first things that you should check about the company is that they are clearly displaying their consumer credit license, which is mandatory for any loans company. If you can’t see this on the website, they might not have a legal license to give you the loan.
You should also be able to see an example of their representative APR rates which should be at least 1.5 times larger than the other fonts on their site. Always read the small print before making that all important signature online.
Don’t Be Scared To Ask For More Information
To make sure that you get the best deals on your loan, thoroughly check through loan providers to see how much everything will cost you. If you aren’t sure about any of the charges, then just ask. If the company is reputable, they should not hide their fees from you.
Only Apply For Exactly What You Need
Many loan providers will have a particular limit when lending to customers and this is also true if you are a first time customer. Although this is in place, always be sure to only ask for the actual amount that you need to cover the costs you need assistance with. It might be appealing to borrow a larger amount of money, but it’s likely just to cause more problems. Keep in mind that the money is only lent for a short time basis, so will need to make sure that you only borrow what you will have available to repay at the end of the month (usually your next payday).
The Rise of The Payday Loan
In the past 5 years, the amount of people that have taken out a payday loan has quadrupled, showing the sharp increase in popularity of these types of short-term loans.
Why Are They So Popular?
The cost of living is increasing day by day, with petrol prices horrendously high and food costs through the roof. After the tough recession, it’s no wonder that so many of us are searching for ways to get from one payday to another.
Before the introduction of the payday loan, the options that were available to customers were either lending cash from friends or family, taking out a more traditional ‘high street loan’ or in a worst-case scenario – a local loan shark. The difficulties with these options is that many people feel embarrassed taking out a loan from people they know, the more traditional loans can sometimes be more strict with who they lend to, and the loan sharks could be just plain risky.
Payday loans now mean that more and more people are discovering that they have another option to help them with the strain of emergency finances, before they get paid.
Why Do People Take Out Payday Loans?
People generally take out payday loans as an emergency source of cash, so for anyone who finds themselves short of money before their next payday, they can be extremely helpful.
Also, depressingly, as a result of the miniscule interest rates that we receive from our savings, means that many people don’t bother to save money regularly. The outcome of this is that many of us don’t have an emergency fund to call on, should a disaster happen like a car in need of repairs or a broken washing machine.
Is A Payday Loan Right For You?
A payday loan isn’t right for all circumstances and it’s probably a good idea to consider all of your options before taking out a loan. One of the key things to think about, is to ensure that you will have enough cash to repay the loan when your repayment date comes along. If you think that you will not be able to meet the repayments, then it might be a good idea not to apply for one of these loans.
Increase In Card Fraud Spells Disaster For Consumers
It’s fair to say that money’s a little tight at the moment for most of us, so becoming a victim of bank fraud just doesn’t bear thinking about.
Unfortunately however, in the first half of this year, cases of reported fraud have increased by 10% up to nearly 112,000 confirmed frauds. One in ten of these, have involved the unauthorized access of our bank accounts.
Crimes which involve the misuse of bank accounts have hit the highest levels since 2009. The most targeted are credit, debit and store cards, meaning it’s so important to be vigilant when using your plastic, especially online.
So, if you’re looking to take out a short term loan, always make sure you are vigilant about who you give your card details to. Always check that your loan provider has a consumer credit license (meaning that they are regulated by the OFT) and that they are a reputable company.