Payday Loans

Are Payday Loans only for those who Need Money Fast?

Payday loans can be arranged very quickly. This means that it can be tempting to think that they are just there to benefit those that need money quickly. Although they obviously do benefit these people, they also have many other advantages that could benefit others as well.

  • Simple to arrange– sometimes arranging a loan can be difficult. You might have to speak to a lender in person, so arrange an appointment and give them all sorts of information. You might have to fill out all sorts of paperwork and things like this. A payday loan is very simple to arrange and can often either be done over the telephone or online. This means that it is not complicated and does not take very long either. Some people hate filling out forms or dread having appointments with a lender and so having a simple process can make things a lot easier.
  • No credit check – no credit check is done on those applying for a payday loan. This means that it is a loan which is more accessible to everyone. Many people find that they cannot get loans because of their bad credit record or that they are charged a really high interest rate because of it. Payday loans do not do this – they offer the same rate to anyone regardless of what their credit rating is like as they do not check it. Not only does this mean that loan is available to all but also that it can be arranged more quickly as this check does not have to take place. You do not even have to worry about making sure you credit record is correct or thinking about what it might say.
  • Quick to repay – a payday loan does not last long and so it is repaid very quickly. The loan is set up so that you repay it on your next pay day. This means that the loan will not last longer than a few weeks. Some people do not like the idea of a loan hanging around for long and so having one like this, which only lasts a few weeks can be idea. There will be no worry of the debt lasting a long time as it will soon be repaid and gone. It can be nice knowing that by the time you are next paid, the loan will all be paid off and you will no longer have to think about it.
  • Just one repayment – most payday loans have just one repayment. This means that the loan will be repaid in a lump sum which includes both the amount borrowed and the interest. It can be easier planning for just one lump sum payment than working out how you can manage regular monthly repayments, which you might have to do with other types of loans. It can be good to know that it will all be repaid quickly. You will just have to budget for the one month, before you repay the loan and then afterwards for the following month as you will have less money to manage on. Once you have done this you will be able to relax and not think about repaying the loan any more.
  • Only borrow small amounts – with a payday loan there are limits on how much you can borrow. You can borrow just up to £1,000 although many lenders will lend less. If it is your first time of borrowing with them, they are more likely to lend you less. By limiting how much you can borrow it means that that loan will be easier to manage and you will not be borrowing more than you need. Often, we can be easily tempted to borrow more money than we actually need and this can be problematic. It means that we can end up paying back a lot more in interest than necessary due to borrowing more and we could even find it harder to repay as a result. By limiting what we can have, we are likely to only be able to borrow the amount of money that we need to help. This means that the loan will not be unnecessarily large.

So, as you can see, there are lots of reason why you might consider taking out a payday loan. It is true that they are very quick to arrange and this means that if you need money quickly you will get it with this sort of loan. It can even be possible to have the money within a few hours of applying. However, this is not the only reason that a payday loan could be useful. It could be useful because you can only borrow small amounts for short periods of time, you need no credit check and it is simple and easy to arrange.

Payday Loans

Are Payday Loans Good Value for Money?

It is always wise to think about what value for money you are getting from the things that you buy and a payday loan is no exception to this. This is because you want to make sure that you are spending your money wisely. You need to think about what the loan costs and how it is benefitting you and then you will be able to calculate whether you are getting good value for money for the loan or not.

What is it for?

Firstly, it is worth thinking about what you are going to be using the money for. Consider whether you feel that it will be worth getting a loan to pay for this item. This is a very personal decision but you need to think about whether it is an item that will really benefit you or whether it might be a purchase that there is a possibility of you regretting. If it is to pay for something in an emergency that you have to have then it is less likely that you will regret it compared to buying a treat for yourself. There are some cases where people get loans and they no longer have the item they used the money to buy but they are still repaying the loan and that can be a nasty feeling. It is unlikely that you will forget what you have bought with a payday loan as you have to repay it so quickly, but you still need to give some thought to whether you feel that what you are buying is worthwhile.

How much will it cost?

It is also worth finding out how much the loan will cost you. You should find that this will be pretty easy. This is because there are calculators on the payday lenders websites. These will tell you exactly how much you will have to repay. If you take away the amount that you have borrowed from this figure, you will then be able to work out how much the loan is costing you. This will allow you to consider whether you think that the loan is worth the cost. It is good to think about the item that you are buying with the money and imagining that it was this much dearer when on the shelf. Consider whether you would still buy it at that cost and this will help you to think about whether you think that it will be worth it.

How much will it benefit you?

It is then worth thinking about the item that you are buying and how much benefit it will give you. Consider whether you can wait for the item and save up rather than getting the loan. Consider how much pleasure it will give you or whether it is something that you need and you will not be able to go without. It could be that you need it for an emergency and therefore you will see a real benefit and right away. However, if it is not for an emergency purchase then you will need to give more thought to the benefits that you will see form it and how valuable these will be.

It is worth spending a bit of time thinking about these things. You will then be able to decide whether the loan is the right thing for you. Many people will still feel that the loan will be of benefit and they will enjoy the results of it. There will be some that decide that it is not the right thing for them at this particular time. However, it does not mean that it will not be a useful thing to consider in the future. It is good to think it all through so that you know that you are making the right decision for you.

Often a payday loan will be seen as good value for money. However, it is really important to make sure that you work it out so that you know whether this really is the case for you. You will need to think about what it is that you need the money for and whether you really can justify the additional cost that you will have to pay for it because of using the loan. Calculate the cost of the loan and that will help you. Also think about how much you will benefit from the item you are buying. With all of this information you will be able to work out whether the loan will be good value for money for you. It can seem annoying to take this time to work this all out. It will be worth it though as you will know for sure whether you are making the right decision or not and you will not regret your decision.