Short-term cash loans or payday loans are typically reserved for unexpected emergencies, occasions when repairs or bills – such as private dental care, house repairs or expensive bills – leave our wallets a little light.
Times like these are not at all uncommon, and we’ve all been there. Often there are times where we have to borrow small amounts of cash to balance our finances, as well as make sure we have enough to pay the bills and get through to the next month. In these instances, short-term cash loans can provide a much-needed lifeline, and that’s exactly why payday loans are good.
But when it comes to a payday loan, it’s important to take it out for the right reasons. You should always assess your current situation and carefully consider whether or not you will be in a position to repay the monthly instalments. In essence, it’s about making responsible borrowing decisions.
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So, to help you make a responsible borrowing decision when it comes to short-term payday loans, we’ve highlighted five reasons why payday loans are a good idea and better than other forms of credit for unexpected emergencies or financial difficulties.
Why are payday loans good?
Borrow, repay and be done with it
Designed for emergencies, payday loans offer quick and comparatively easy access to cash for financial emergencies, accidents and/or unexpected changes in circumstances. For example, as mentioned above, your house might need urgent repairs – perhaps a burst water pipe or damage to your windows. Both problems could cause issues later on, so it’s important that they are resolved right away. Of course, paying for such repairs is not cheap – and on top of your other financial commitments, it might mean your budget for next month is a little less than you’d like, making it hard to get by!
In scenarios such as this, payday loans are highly effective. You can apply for credit and – in some instances – have money in your bank account within the hour (at Uncle Buck, it could be as little as fifteen minutes). This allows you to get on with paying for those repairs without further delay and you can start paying back your loan over a period of four or six months.
Better than a long-term loan which could take months – if not years – to repay! Just one reason why payday loans are a good idea!
No need for collateral or ‘security’
As payday loans are unsecured, you can borrow without having to put down any form of collateral, such as a car or home, as a guarantee – giving you peace of mind that none of your valuables are at risk of being automatically repossessed if you default on payments.
That said, we would strongly advise that you always pay your instalments on time, so as to avoid incurring a late payment fee and additional interest. It’s important to remember that payday loans are designed for short-term emergencies and/or unexpected expenses and are not a suitable means for long-term financing or for those in financial difficulty.
Before taking out a payday loan, you should always consider possible alternatives, as well as if you really need to borrow at all.
No danger of temptation
Credit companies are well aware of the fact that we live in a “buy it now, pay for it later” economy and capitalise on that fact. They know that people – especially those in financial difficulty – will be tempted to use a credit card to pay for things when their budget is tight, so they may raise your credit limits from time to time (assuming you are making the necessary minimum payments regularly). Before you know it, your debt is getting out of control and repayments are becoming virtually impossible.
Short-term payday loans, on the other hand, provide the money you need when you need it most. You apply for a fixed amount – preventing you from spending more than you should – and pay it off over a fixed period.
As opposed to credit cards or long-term loans, payday loans are much more accessible and convenient. The checks are quick but comprehensive, meaning finances could be available the next day or within hours.
At Uncle Buck, we review and approve applications around-the-clock and can have the funds transferred to your account within fifteen minutes. Our application process is simple and straightforward – with on-screen instructions and information about what we require – so you can have it completed in no time. The accessibility and convenience are another reason why people use payday loans and why payday loans are good for financial/unexpected emergencies.
Payday loans are great financial injections if handled correctly. Rather than having an extended loan repayment term, the loan must be repaid in a short, set period. This gives you more control: you know the loan will be repaid quickly and you will then have greater financial flexibility to spend money elsewhere.
At Uncle Buck, we allow you to repay your loan over a four or six-month period. You do not have to rush to repay your entire loan and interest at the end of the month, as with most payday loans, giving you more breathing room and financial flexibility.
Are payday loans a good idea for financial emergencies? Yes – but only if used responsibly!
Payday loans are designed for financial emergencies and we would encourage you to not use them for anything else. Of course, what’s most important is that you carefully evaluate your financial position and ask yourself whether or not you will be able to pay the agreed monthly repayments without difficulty.
At Uncle Buck, we are committed to lending responsibly and ensure that we provide you with all the information you need to make informed borrowing decisions. Before accepting your application, we will assess whether or not you are in a position to repay the loan.
We are here to help you cope with unexpected financial difficulties – not to lead you into a cycle of never-ending debt.
If you have questions or want to find out more about our loans, please download our FAQ eBook by clicking the button below.