Easy Short Term Payday Loans
When it comes to financial emergencies, sometimes your budget for the month just won’t be able to cover the likes of an unexpected bill, a broken down car or any other of the many problems that life can unexpectedly throw at you. While a lot of people tend to frown upon options like payday loans due to their bad reputation, there are a number of reputable quick loans lenders on the market that can offer good interest rates and will only responsibly lend to those who can afford it. Here we’ve put together a quick guide on what payday loans are and how they may be able to help someone who is struggling with their finances.
One of the most important things to know about payday loans is that they are meant to only be taken out for the short term. While there are a number of options when it comes to payday loans such as the option of an installment loan which can be paid off over a series of months, short term loans are deemed to only be for a short period of time in order to cover an unexpected bill when you need it most in a financial emergency. The idea behind the payday loans is that they are only supposed to be used to cover people in the few days up until payday, as a stop gap until your wages arrive.
How Much Can You Borrow?
Some lenders tend to restrict the size of payday loans, but often these will be around £1000 for a short-term loan with periods being less than a week. There are not usually early repayment charges on a payday loan, however fees for setting up the loans and interest which is added to the loan per day is what makes payday loans so expensive for many people. There is often an argument between whether payday loans are better or worse than a bank overdraft, and in the majority of cases particularly in recent times, the argument has been in favor of payday loans.
One of the biggest things to catch people out when it comes to payday loans is the charges if you miss a repayment. These can be catastrophically large, and can cause the amount you owe to quickly go out of control. While some lenders can be flexible when it comes to late repayments if you get in touch first, the charges and late repayment fees are often what catch people out.
Annual percentage rates on payday loans are known to be very large, with some representative APR reaching over 2000%. However, the way APR is calculated is not actually suitable for short-term lending which is why the interest rate goes up so high when it comes to a payday loan. APR is what can make it difficult for borrowers to work out exactly how much they’re going to be taking out, making it even harder to compare where to get the very best payday loans from.