Taking out a payday loan requires you to take a series of important factors into consideration. The following checklist should help you select the right loan for your situation and help you to keep out financial trouble.
Do your Homework
There are thousands of payday loan companies and brokers offering their services to UK consumers. Finding the right company to deal with your needs can be difficult. Do not be tempted to pick the first company your search engine brings up, but explore and compare the terms and conditions of as many companies as possible before making any kind of commitment.
Some payday lenders in the UK add faster payment and/or other arrangement fees to your overall payment. This effectively serves no purpose other than increase your cost. We have no additional or hidden arrangement or ‘faster payment‘ fees – we show you exactly what you will have to pay at the start and those figures will not change (unless, of course, you fail to make your payment, but you will also be aware of what will be added to your overall cost in case of this happening right from the beginning).
Direct Lender vs. Broker
Many payday loan brokers out there are not exactly fully transparent about the way they operate. Unless you are aware of the fact that you are dealing with a broker, you could end up working with a never-heard-of company you did not sign up with. Borrowing from direct lenders has many advantages, so make sure you know who you are dealing with.
Payday loans can be of great help when you hit a tight spot and need a small injection of cash to help you cope until the next payday. They are, however, not meant to be taken out over prolonged periods; if you have long term financial problems or to pay off some other debts.
Some people think lying on their application gives them a better chance of qualifying for a loan or getting a higher loan amount. This is, however, not a wise thing to do. First of all, responsible lenders will make credit, bank and employment checks to ensure you have the ability to repay – lying on your application will not put you into their ‘good books’, but is highly likely to get you a refusal. Secondly, borrowing more than your financial situation realistically allows you to pay back is likely to make your situation worse.
Keeping in Touch
In addition, if you should find yourself unable to make your payment on the date it is due, get in touch with your lender immediately. Having built a good relationship with them to begin with, you will be met with far greater understanding and flexibility than you would if you ignore the problem in the hope it will disappear.