What you need to remember about payday loans
The one and only goal of this blogsite is to provide the UK public with more information on payday loans, the type of loans that has only recently appeared in the United Kingdom, but which is slowly but steadily (more quickly in the last few years than before) becoming more and more popular as more people on the UK are made aware of these loans and what they can do for them. We are not economists here at this blogsite. Instead, we are just ordinary people who happen to have had some experience with payday loans and who believe that other people in the UK should learn more about these loans as they can definitely be life savers in certain situations. This article is dedicated to providing you with facts on payday loans that all UK borrowers should remember as it will allow them to have the most positive experiences possible with these loans.
The most important thing to remember about payday loans is that the interest rates associated with these loans are several times higher than those associated with some other, more conventional types of loans. In fact, these interest rates can get so high that it makes very little sense in taking out these loans. This unprecedented height of the interest rates is determined by a number of factors. The first of these factors is that the lenders need to cope with a large percentage of defaults on the loans, with many people not repaying their loans. Also, as payday loans are paid very quickly after taking them out, the high interest rates are necessary for the lenders to be able to earn a living. Finally, the government is in no way limiting the interest rates and this has lead to some lenders really going crazy with their interest rates.
As we have already mentioned, the payday loans are repaid very quickly. That is exactly how they got their name as they are supposed to be (ideally) repaid on your next payday. Of course, in practice, this does not happen always, but usually, you will be repaying the loan within a month, two at the most. That is, if you are smart and do not wish to get bogged down in interest rates, fees and rollovers that can turn payday loans into a nightmare.
We would also like to inform you that you can get payday loans online in the UK these days and that this is the soundest practice that you can employ if you wish to take out these loans. The choice is much wider online and you are able to find exquisite deals on your loans.
A few other things that we would like for you to remember about payday loans in the UK is that the vast majority of lenders is also going to charge you a fee when you take out a loan, usually amounting to 25% of the amount you borrow. We would also like you to remember that you cannot borrow just any amount of money with a payday loan. You can take out anywhere up to £1,000, while some lenders with whom you have done business for a long time might actually lend you even more. However, lending anything more than a grand is usually not the smartest idea due to the interest rates.
Taking all of the aforementioned in consideration, it is obvious that payday loans are something you should be careful about. However, they are also the only type of loan that you can get with a poor, or even an abysmal credit rating and the only type of loan that you can get within one business day, if not even less. Because of this, payday loans are a welcome inclusion to the UK financial market and we believe that they can be of great help to certain people in certain situations.