If you have not had a payday loan before, then you may assume that they are not for you. It is good to have an understanding of payday loans and who they are for so that you will know whether they will be right for you or not.
Who were they designed for?
To start with it is good to understand about the origins of payday loans. They actually came about as there was a poor selection of options for borrowers who had a poor credit record. The lenders saw that there was this need for borrowing from these people and so created a product that they could use. These payday loans had no credit checks which meant that it was possible for anyone to apply for a loan. This means that if you have a poor credit rating it means that you will still be able to get a payday loan if you wish.
Who can use them?
This might make you feel that you can only get a payday loan if you have a poor credit rating. It is true that you can get one if you have a poor credit rating, it does not mean that the loan excludes anyone that does have a good credit rating. So, whether you have a good or poor credit rating you will still be able to use the loans. In fact, there are only a few things that could disqualify you form getting a loan. These could be your age; as you have to be over 18, if you are not resident in the UK, if you do not have a bank account; as you need to be able to set up a direct debit to repay the loan and if you do not have a regular income to repay the loan.
Are they right for you?
It is important to think about whether they will be the right loan for you. The work quite differently to many other types of loans and so you may find that they are the right option for you. Firstly, you borrow a small amount of money which can be much more manageable for many people. You will also have to repay it when you next get paid. Not only does that mean that you should have the money available to make the repayment, but the loan will not last long and so you will not have the worry of having a loan hanging around for a long time. The loans are also very quick to arrange. You may even find that you will have the money within a few hours. This therefore means that they are really suitable for anyone who needs money in an emergency. Even if you have a good credit rating and can get money elsewhere, the speed of these might be so good, that you will choose them above other types of loan anyway.
It is important, to therefore think about what you need in a loan and whether the payday loan will suit your needs. You need to consider the purpose of your loan, how much you need to borrow, how long you need to borrow it for, whether you can afford to repay in one lump sum, how you feel about being in debt, what you r credit rating is and how quickly you need the money. This should help you identify whether the payday loan will be the best type of loan for you and your needs.
Do make sure that if you have decided to go with a payday loan that you need to compare the different lenders as well. They will all differ in the way that they do things so the cost, customer service and things like that will all be different. Do some research so that you can find out which will be the most suitable for you. It is good to spend a bit of time doing this if you can, as it can make a big difference. Ask people you know if you can, as they will be the best to make recommendations as they will have no reason to be biased and want to help you to find the best lender that you can. If you cannot ask them or would rather not discuss finances with them then you could look online. Make sure that you use trusted sites and that you are sure that the reviews are genuine. Also make sure that if there are ratings, that you think about why the ratings are the levels they are. If there is a review with the rating take a look at it and you will be able to see whether the person was displeased with things that are important to you or things that you do not really care about.