Payday Loan Characteristics
Most people wonder why others would choose to take on a payday loan with high interest rates instead of other loan options, which normally turn out to be much cheaper in the long run. Nonetheless, regular loans like personal and secured loans will take much longer to process than a payday loan, and in some instances, will prove beneficial when utilized wisely. One of the benefits of opting for a payday loan is that lenders will not require a credit check. So whether or not your credit history is in shambles, you will most likely be approved for a loan. Another characteristic of the payday loan is that the amounts lent are usually small and are short-term in nature. Generally, the maximum amount that is lent is £500, although with some loan companies, this can go as high as £800. £500 is par for the course, mainly because these are taken to meet daily living expenses. Payday loans can also be considered secured loans in the sense that the next salary will be used as collateral. In order to be qualified for a payday loan, you must have a regular income that is paid into your bank account and have a cheque book or debit card. It is also to your advantage if you have a cheque guarantee card. Some lenders want the borrower to be employed for at least a period of three months. Borrowers must pay their loan by next payday, and their loans are saddled with a high interest rate when compared with personal loans. As an example of interest rates, just add £25 per £100 borrowed. The best way of applying for a payday loan is doing it online. First, you save the time and trouble of doing it in person and second, you can find better rates by simply searching. To apply faster, make sure you have all your important information and details needed. Most online lenders will require your address, phone number, bank name, bank account number, check number, references, when you get paid, so on and so forth. Look at your paycheck or pay slip under net pay when filling in an area on take home pay.
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