What exactly are Payday Loans
October 13, 2017
Michael Christopher (36 articles)
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What exactly are Payday Loans

Most people think, when they get a loan it is something that takes a long time to arrange, but with a payday loan this isn’t the case. Payday loans are well know for their quick process once the application has been submitted, and with various the online options provided when applying for a payday loan, this process is speeded up even quicker.

You may find the speed of response when applying for a payday loan very useful, particularly when:

• You don’t necessarily have the time to fill out long applications.
• You don’t want to spend a long time waiting for a decision, as to whether your application for your loan has been approved or not.
• You may need the cash quickly and don’t want wait a number of days before you have the cash.
• You want to be able to pay the loan of quickly, instead of spending years paying back the money you borrowed, when you know you will be able to pay it back within a matter of weeks, once you have been paid.

A big factor before taking out a payday is loan is when you will pay the money back.

During your application, will you select a date for when you will pay the money back (this date is generally only a few weeks away for the application date and is typically the same date as when you next get paid)

Finally, you will need to meet the lending criteria of the company, which is usually:
• You are aged 18 or over.
• Currently in full time employment.
• Have a minimum salary of (will be stated).
• You have a UK bank account.

Another beneficial characteristic of this short-term loan is the speed at which it can be taken out.

This has proven, on many occasions, to be one of the crucial reasons for its increasing use. People who unexpectedly need money can just go to the lender, perform the few checks they require, and leave their office with the necessary funds. Companies in the United Kingdom will even go through all the trouble to insure that an individual can take it out in a matter of hours. In some cases, people have been able to procure cash from these lenders in as little as an hour.

The biggest culprit in the problems associated with the payday loans is their interest rate.

 In most cases, it is fixed at a particular number while the initial terms hold (i.e. the payment of the interest and the principal is not yet due). However, once the loan is due and it has not been repaid in the requested time, the interest rate jumps quite high.

In some cases, people have been able to procure cash from these lenders in as little as an hour.

The biggest culprit in the problems associated with the payday loans is their interest rate. In most cases, it is fixed at a particular number while the initial terms hold (i.e. the payment of the interest and the principal is not yet due). However, once the loan is due and it has not been repaid in the requested time, the interest rate jumps quite high. In most cases, it reaches values two or three times its original rate. Once this happens, most people find that they either cannot pay back the money or they waste quite a lot of their own money to repay the interest rate.

Source: paydayiom.co.uk

Michael Christopher

Michael Christopher

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