February 27, 2020

How do I Repay my Payday Loans?

Many people do worry about taking out loans because they are concerned about repaying them. While it is right to make sure that you are capable of repaying it, as long as you do your research carefully, you will reduce the risk that you will not be able to repay the loan. Payday loans have often been reported as being problematic in this area and it is not surprising that this has put people off using them. However, they are no different to other loans with regards to the risks of not being able to repay, you just have to make sure that you are confident before you take one out.

How do payday loan repayments work?

Payday loans work slightly differently to conventional loans with regards to how they have to be repaid. They are not repaid in instalments, which is usually the case with other loans, but you have to repay them in one lump sum. This is set up by direct debit so that you do not forget to make the repayment. You will have this direct debit set up so that the money will leave your account on the day that you are paid. This will enable you to be sure that the money will be available to pay for it. The fact that you have to repay the whole loan plus the interest and charges in one go, is something that some people find tricky. However, as long as you plan carefully and borrow an affordable amount, this should not be a problem for you.

How do I make sure it is right to take one out?

It is therefore wise to start by looking at your financial situation. You will obviously be in a place where you need some money, which is why you are contemplating a loan. However, it is important to look beyond this and think about what money you have coming in and what you tend to spend. This will allow you to find out how much you will have available to repay when you do borrow. Of course, it might be that you will be able to reduce your spending by buying less or buying cheaper things so that you will have enough money or do some extra things to earn more. However, you do need to think about this really carefully.

How do I ensure I can pay?

With a direct debit set up, the money will leave your account, but you will need to ensure that there is enough money there to cover the loan. Make sure that you borrow an amount that you are confident that you will be able to repay. Once you have looked at your bank statements you will have an idea as to how much you will be able to afford. If you have decided that you will need to spend less or earn more to be able to afford it then make sure you start working on this right away. You need to identify where you are planning on spending less and immediately work on that by cancelling subscriptions, switching supplier or retailers and things like that. You might want to stop going out to shops or visiting online retailers where you are likely to spend money as well. If your plan is to earn more then also get straight to it thinking about what you will do and organising those opportunities. It might be that you plan on doing some overtime which you will need to set up, freelance work which you will have to arrange or online work that you will have to look for. You might decide to sell things so you will have to get them ready for sale and decide where to sell them. Make sure that you do not procrastinate and that you do more than necessary to ensure that you have enough to repay the loan. It is worth remembering that you will be likely to only have a few weeks before the loan will need to be repaid so you will not have long to get organised. It might be that doing overtime will be too late as you may not get the pay for that until the following month, so make sure that you check. Also, looking for other work might take too long before you find something or before you get paid for it. Therefore, make sure that you think things through really carefully and make sure that you are completely sure that you will have the money when you need it. If it is a case of spending less, then perhaps leave your debit card or purse at home so that you cannot spend money even if you want to. You might need to be more organised, such as not doing unnecessary journeys so you do not have to fill the car up so often or taking a sandwich with you to work so that you do not have to buy one.

How do no Credit Check Loans Compare to Other Loans?

There are lots of different loans available for us to use and there are big differences between them. Sometimes it can be difficult to know which loan to choose because there is a confusing mix of different types. It is important to understand the differences between them so that you can make the right decision. You need to think about all sorts of factors to make sure that you match the loan that you choose with the requirements that you have. To start with it is good to know the difference between no credit check loans and other loans and then you will be on your way to making the right choice for you.

What are no credit check loans?

A no credit check loan is rather poorly named. A credit check does take place, but the lenders will be prepared to lend to those who have a poor credit record. They will be looking for anyone who is over the age of 18, has a regular income and lives in the UK. They will check to make sure that those criteria are fulfilled. They will not look to see what the credit record is like though as they are prepared to lend to those that have a poor credit score. This is because these loans were set up specifically to help those that have a poor credit score to be able to borrow. It was noticed that there was a gap in the market, where those with a poor credit score were just not able to borrow and these lenders decided that they wanted to rectify that situation.

What types of no credit check loans are there?

There is an expanding number of different types of no credit check loans. They differ slightly, but they all are available to those with a poor credit record, although anyone can apply even if they have a good credit record. The most well-known is probably the payday loan, which lends you a lump sum of money which has to be repaid in full when you next get paid. This is designed to help out in an emergency when you have run out of money and cannot wait until you are next paid to get the money. The loan is repaid really quickly so people like it because they are not in debt for long. If they find paying back in one go is too difficult, an instalment loan can be better. This will allow repayment to be spread across a series of months rather than just in one lump sum which can make it easier to manage the repayments. Both of these loans only lend relatively small amounts of money though and if you want more money then you could look at a guarantor loan. These do offer significantly more money which you repay in instalments but you will need to find a person with a good credit record that will act as a guarantor for you and make any repayments that you are not able to. If you have a vehicle you could use a log book loan, which will allow you to borrow money against the vehicle but if you miss repayments the vehicle will be repossessed so this is a risk that you will have to consider very carefully.

How do they compare to conventional loans?

Conventional loans tend to have the option of lending you more money. A mortgage, student loan or personal loans could lend more then tens of thousands of pounds which is an amount that you will never be able to borrow with a no credit check loan. You will also find that conventional lenders might tend to be more well-known than no credit check lenders. This is partly because no credit check loans are reasonably new and therefore, they have not had the time to get well-known. Also, they tend to be smaller companies and may not have the budget to advertise. They also tend not to have high street branches. The loans themselves tend to be faster to arrange than conventional ones, available to those with a poor credit record and for smaller, more manageable amounts of money.

If you do have a poor credit score then these loans could be really useful for you as you will have no alternative options. However, they are also available to anyone who has a decent credit record as well. It could be worth thinking about whether the speed of organising the loan or the fact that you can borrow smaller amounts of money might be more appealing than a conventional loan anyway. It is good to make sure that you look at all of your options because then you will have the very best chance of finding a loan that works really well for you.