Frequently Asked Questions Page
Payday loans are quite new to the market in comparison to other types of loans such as bank overdrafts and so on, so it's no wonder that a lot of people have questions about them. We're going to go through some of the most frequently asked questions about payday loans below, but if you have any other questions that we haven't covered don't hesitate to get in touch with us!
What Do I Need to Get a Payday Loan?
The great thing about these loans is that all you need to get a payday loan is a job (even if you're on minimum wage) and the ability to pay back the loan on your next payday. For most people, they'll get paid on a weekly basis so you should pay it back within a week. However, if you get paid monthly you can still take out one of these loans. Don't forget that you need to be 18 or over to get a loan too!
How much can I Borrow?
All payday lenders have different borrowing limits, but the majority of lenders allow you to borrow up to £1,000 which is usually more than enough for people. If you need any more than this, it mightn't be a bad idea to get in contact with the lender and see whether they can arrange a special deal for you (don't forget that you'll need to show them that you'll be able to pay the money back in time!).
What if I have a Poor Credit Rating?
Not so long ago, if you had a poor credit rating you'd never be able to get any kind of loan. However, this has since changed thanks to payday loans. Nearly all lenders don't even ask whether you have a good or a bad credit rating, so you don't even have to mention anything about your credit rating to them. There is one downside to this though: You'll be charged a higher interest rate. Because of this, if you have a good credit rating why not tell the lender and see if they'll give you a discount?
What Details does the Payday Lender Need?
Applying for loans used to be very time consuming (not to mention really boring!). The good news is that payday lenders don't need a lot of information about you to give you a loan, so you won't have to spend hours of your time getting all your information together. The only details that lenders need are basic things like your name, address, where you are currently employed etc. You can apply for a payday loan within a matter of minutes which is great news if you're in a hurry to get some money.
What can I use Payday Loans for?
Once you receive your money you can do whatever you want with it. Nobody is going to ask you what you spent your money on or whatever, it's totally up to you! Some examples of what people use payday loans for are: repair your car, pay off heating bills, pay medical expenses etc.
What is APR?
APR (or annual percentage rate) is the amount of interest that you'll pay on top of the amount of money that you borrowed. Let's say you borrow £100 and the APR is 50%, then you'll pay back £150 to the lender the following year. When it comes to payday loans, the APR is usually very high in comparison to other types of loans. However, it's important to remember that you're not supposed to pay back a payday loan in 12 or even 6 months, you're supposed to pay it off on your next payday. Because of this, the interest that you'll pay won't be as bad as it first seems.
Is there Collateral on Payday Loans?
Unlike most other loans, there is no collateral at all with payday loans. If you're not sure what collateral is, it's basically something that the lender can take off you if you don't pay back the money that you owe them. For example, if you take out a car loan the collateral might be the car that you've purchased. The great thing about payday loans is that there is no collateral needed, so if you are having a hard time paying back the money that you borrowed the lender cannot take any of your possessions.
We hope that these FAQ's have helped you learn more about payday loans. If you need any more information just get in contact with us and we'll get back to you as soon as possible.