Payday loans or instant cash loans prove to be very useful if you need a relatively small amount of cash quickly. They are not intended as a long-term loan, instead they have come about to help people overcome any emergency financial situations that may arise in between pay packets. The reason for this is the fact that the lender will require the loan to be repaid in full on your next payday. To make sure this happens the lender will require you to either set up a standing order with your bank or they will debit the full amount from your debit card when you next get paid.
Who qualifies for this type of loan?
To qualify for an instant cash loan you will need to be at least 18 years of age and employed (full-time or part-time) with a minimum income of £750 per month. You will also need your salary to be paid directly into your bank account and your bank account will need to have a debit card attached to it. The lenders will also require a valid email address, landline and mobile telephone number. There are an ever increasing number of lenders that offer this type of loan, with loan amounts available ranging from £50 to £1,000 in some cases. However most of the lenders will restrict what you can borrow the first time around.
What does it cost to borrow money in this way?
Again because there are a great many lenders that offer this type of loan, the rates that they charge vary quite significantly depending on what type of borrower they want to attract. They do however all base the rates that they charge on a cost per £100 borrowed. For the lenders that want to attract the higher loan amounts and therefore applicants with a better credit rating this usually starts at around £25 per £100 borrowed. However for the lenders who want to attract the other end of the market and in some cases they will underwrite their loan without the need for a credit check, they will charge up to £40 per £100 borrowed. The second type of lender will also only allow you to borrow smaller amounts of money.
How do I get a payday loan?
Applying for this type of loan could not be easier these days, with most people having access to the internet all you need to do is go to your favourite search engine type in your keyword and be presented with a huge list of options. Once you have found a site that you are happy with all you need to do is submit the application form, in most cases you will receive an instant decision and could even have the money deposited into your account on the same day that you apply. Dependant on the lender that you choose you may not even be required to fax any documents to them. Some of the more sophisticated lenders have a process that allows you to sign the agreement digitally whilst sat at your computer.