If you are new to quick payday loans, you may be wondering exactly what they are. After all, what is so special about them, and are they really any different from any other kind of loan?
Payday loans may typically be available for a couple of hundred pounds, over a few weeks. They are designed to plug a gap in your finances and be repaid, as their name suggests, on your next payday. Larger sums may be available to borrow if you build up a degree of trust with a particular payday lender but regular borrowing is not encouraged by the reputable providers.
Payday lenders do not mess about. Instead of asking you to fill in long, drawn out forms, many of them will merely present you with an online questionnaire which asks for your name, address, age and job details. That’s all they need to know to check your identity and run a brief credit check.
For those of you who are terrified of credit checks, don’t panic. Some payday lenders may not even do a full in depth one. Instead, they may rely on a quick online version, which, although revealing any negative points that may be on your record, may mean that some people who find their credit options limited from other lenders may be accepted with a payday lender.
With quick payday loans there is only a small amount of money outstanding for a couple of weeks, so payday lenders may be prepared to consider you if you have been turned down elsewhere.
How do they differ from traditional loans?
Apart from the speed with which they are processed, quick payday loans may have other advantages over traditional forms of borrowing. From the customer’s perspective, you may find that:
-it may be easier to understand exactly what you owe, as credit cards, loans and overdraft interest calculations can be tricky. Some payday loan companies have an easy to use calculator on their website that will show exactly how much it will cost you to borrow the money, including any fees and interest;
-the amounts may typically be repaid automatically on your payday rather than in a few years’ time;
-you may not have to justify why you want the loan – as long as it is repaid on time, payday lenders may typically not be interested.