What are short term loans?
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What are short term loans?
What is a short term loan or payday loan?
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UK payday lending

Payday loans originated in the USA where they have been around for many years and they are now the fastest growing method of borrowing in the world. Although UK payday lenders are relatively new, already over 4 million people from all walks of life apply each year and the number is increasing all the time.

In the current economic climate many people find themselves running out of money in between paydays. Some people resort to using an overdraft facility on their current account to get through the month, or they use their credit card to pay for day-to-day expenses.

Depending on the UK payday lender you use, you could pay a fee up to £25 per £100 that you borrow. Additionally, some companies charge administration fees that add to the amount of money you have to repay. So if you borrow £400, you pay the payday lender £500 plus any additional charges the lender adds on. You may be able to find less expensive ways to borrow money, but if you need money in a financial emergency it may be worth the cost.

Another option now available for financial emergencies is a payday or short-term loan. These loans are becoming increasingly popular as they allow you to borrow between £80 and £1000 for up to a month. There is no credit check required and as long as you can prove you have a regular income and a bank account you usually qualify for one of these loans. This makes them especially useful if you have a less than perfect credit score.

The smarter payday and short-term loan websites search many lenders just from one application form. In a sense it's like a price comparison site and all the lenders behind the application process have their own criteria and one of them is likely to lend. Unforeseen expenses crop up all the time and as long as you are able to clear the payday loan in a reasonable amount of time then you should be able to rely on this type loan to help you out.

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Need a short term loan in an instant?

Need a short term loan in an instant? | What are short term loans? | Scoop.it

A payday or short-term loan can be a convenient way to get emergency cash until payday. The application process is straightforward as there are no lengthy application forms and no posting or faxing of documents. The majority of payday and short-term lenders offer quick approval in less than 2 minutes, so customers know straight away if they have been successful.

Payday and short-term lenders can offer greater flexibility than banks and other high street lenders because loans are made available to people with all types of credit history - good and bad.

A typical loan period is up to 30 days and cash can be deposit directly in to your bank account the same day you apply. If you need the money now and don't get paid until later in the month payday loans are a transparent, easy to understand and fast way to borrow the money you need.

Everyone faces unexpected financial emergencies from time to time but before considering a same day loan think about what you need the money for before applying and make sure you budget to repay the loan.

The minimum requirements to apply for this type of loan are:

You must have a bank account that accepts direct debits. This includes basic bank accounts that do not come with an overdraft or debit card.
You must be at least 18 years of age.
You must be a resident and be eligible to work in the United Kingdom (England, Scotland, Wales or Northern Ireland).
You must be employed and receive a regular salary.
You must have your salary paid directly into your bank account.

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Payday loans-understanding how Payday APR rates work

Payday loans-understanding how Payday APR rates work | What are short term loans? | Scoop.it

Annual Percentage Rates or APRs are a part of all types of credit loans whether they are payday loans, short-term loans, personal loans, credit cards, mortgages or any other types of credit agreements.PaydayHappy.co.uk is a new website from one of the UK's leading payday loan providers offering short-term cash payday loan solutions. We work with many of the UK's leading payday lenders to get you accepted for a payday loan.

Over 4 million people in the UK have taken out a payday loan in the last 12 months to cover short falls in their salary or for emergencies like car repairs, fixing washing machines and mending leaking pipes or even settling bills when they can't make it to

APR measures how much a loan or other line of credit costs you in interest over one year and is expressed as a percentage of the total amount of money that you borrow. If you want to work out the APR you pay on a loan first take the amount of your loan and how much interest you will be charged over one year. Then divide that interest amount by the amount of your loan. Multiply the number by 100 and you get your APR.

 

For example, you borrow £1,000 and are charged £80 in interest for that year. The APR is calculated like this:

80/1000 x 100 = 0.08 x 100 = 8%

Normally you know what the APR is before you know how much the interest you will be charged is, so you can determine how much your interest over the course of a year is by using this formula:

1000 x 8% = 80

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Payday loan calculator

Payday loan calculator | What are short term loans? | Scoop.it

Before choosing a payday loan, calculate all charges. Comparing loans can be difficult and confusing with the different types of payment amounts and repayment lengths. The finance industry is required to use APR (Annual Percentage Rate of charge) to make comparing loans simpler.
APR does work well when you compare long-term loans like those from a bank or building society because they are based over a 12-month term or longer. But the use of APR can make shorter-term loans can look quite high at first glance and less favourable in comparison.
This is because traditional lenders do not include things like fees and late payment charges in their APRs, which can make them, appear much lower than ours. Also, unlike ordinary short-term loans, credit on cards can be subject to interest rate changes while you're still paying back the balance.

Representative Loan Example:

If you borrow £300 for 30 days

The amount you payback will be £375

The interest will be £75.

The Interest rate is 1734% (variable rate)

So while the payday lender's APR may look higher than other lenders you should remember:

They won't charge you extra admin fees

The fee is fixed so you always know where you stand

There are no hidden charges

Calculate Loan APR

Use the loan calculator on most payday lenders' websites to calculate the loan amount.
The average APR depending on the lender that accepts is 1734% which is one of the lowest rates in the payday market in the UK.

Representative Loan Example

If you borrow £300 for 30 days
The amount you payback will be £375
The interest will be £75
The Interest rate is 1734% (variable rate)

 

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Can I get a short term loan if I have a bad credit score?

Can I get a short term loan if I have a bad credit score? | What are short term loans? | Scoop.it

If you have a less than perfect credit score or bad or no credit history it shouldn't mean that you have limited options in terms of finding a payday loan or short-term loan.

It has become increasingly difficult to get a loan from banks or other traditional lenders, especially if you have bad credit or no credit history. So a whole industry is developing that is changing the way people borrow money in the short-term, even for people with a bad credit history.

There are a growing number of reputable payday lenders in the UK offering quick, easy and confidential access to funds at a fair price and a growing number of people are discovering them every day.

The good news is that these payday and short-term loan companies typically do not discriminate against people with less than perfect credit scores. Unlike traditional banks and lenders, they offer short-term loans that are usually repaid over a period of weeks, so they are not interested in a bad credit history. The loan amounts rarely go over £1000 and they are designed to offer short-term financial relief in times when money is tight and borrowers don't want to have to wait for payday to arrive.

Because UK payday and short-term lending companies work in is so competitive they make their application process as straightforward and uncomplicated as possible. There are usually no credit checks. The fees are simple to understand and there is a high acceptance rate. Most applications are processed in minutes and funds are made available the same day in most situations.

The application usually only requires proof of income and employment as well as a bank account. This means that if someone applies on Monday because they need money until Friday, they can have it in their account no later than Tuesday.

There are a number of different companies that offer loans to people with a less than perfect credit history so finding one is easy. So compare some of them to see which one fits your needs and your budget. You can complete an application on PaydayHappy.co.uk and we will send your application instantly to many of the leading UK payday lenders. If you still do not receive a Payday Loan from Payday Loan lenders then you can try another option here.

Remember that these types of loans are designed to be short-term and for relatively small amounts and they do have to be paid back in a timely manner.

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PaydayHappy.co.uk - UK Payday loans with a 2 minute decision contact us today

PaydayHappy.co.uk - UK Payday loans with a 2 minute decision contact us today | What are short term loans? | Scoop.it

A typical payday loan works on the basis that when a person takes out the loan it is repaid on their next payday. So most loans are between 1 to 30 days in length and the loan amount plus the charge (Interest) is automatically withdrawn from the person's bank account on the agreed payday date.

Payday loans are a relatively new concept in the UK but are the fastest growing method of borrowing in the world. Already, over 4 million people in the UK, from all walks of life apply each year and the number is growing all the time.

Applications are made online and most payday and short-term lenders work on a 24-hour basis, 7 days a week. Potential borrowers receive an almost instant decision about a loan application and the funds are transferred to their bank account the same day or the next bank working day. So applications can be made any time night or day and on Saturday and Sundays.

Before you take out a payday or short-term loan visit a number of companies' websites so you can make an informed choice about which lender is best for you.

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