There are quite a few myths and misconceptions about payday loans that you should be aware of before filling out an application for one. A lot of people are very apprehensive about getting one of these loans because they don’t understand what they are really all about. You don’t want to let misinformation keep you from getting the money you need when you need it, so you will want to educate yourself. This article will clear up some of the misconceptions about these loans so you can make the right decision.
Payday Loans are Difficult to Pay Back on Time
It is a common belief among people that payday loans are nearly impossible to pay off, but the truth is that you can pay back the money you borrow pretty easily as long as you are careful. You don’t want to borrow any more than you can realistically afford to pay back by the agreed upon date. Most of the people who are late with paying back their loans borrowed more than they should have to begin with.
The Interest Rates are Ridiculously High
While everyone definition of “ridiculously high” is different, the interest rates for payday loans aren’t really all that bad. There are numerous ways that you can get a reasonable rate for your loan, such as by looking for the right lender. Those who take the time to find the right person to borrow from will find that their rate is going to be much more reasonable. Payday loan interest rates are higher than normal, but that doesn’t mean they have to be ridiculous.
All Payday Lenders are Shady
There are lots of reputable, trustworthy short term loan lenders that you will have to choose from. The more time you take to look into your lender options, the more you will discover that they aren’t all bad. It is very important that you make a real effort to find a lender you can trust though. These days a lot of private lenders are based entirely online, so you shouldn’t be able to find quite a bit of information on each one. There are some unscrupulous lenders out there, but for the most part they are completely legitimate and entirely reputable.
People with Bad Credit can’t get Approved
Payday loans were basically made for those with bad credit, which is why so many people in the UK apply for them each year. Just because you have been turned down for loans by your bank because of bad credit in the past doesn’t mean the same thing will happen with these lenders. You still have a good shot at getting approved for the loan you need even with bad credit. These lenders usually do run a credit check, but it’s more so they know what to set your interest rate at. You definitely shouldn’t let having bad credit keep you from applying for a payday loan.
You can’t Borrow very Much
You will find that most payday lenders will allow qualifying applicants to borrow anywhere from £50 to £1500, depending on how much they make. The maximum amount that you will be able to borrow is contingent upon how much money you make with each paycheck. If you don’t make enough to pay back the amount you are applying for on time, you won’t get approved. This is also one of the reasons why it’s easy to pay back these loans. The point is that you can in fact borrow a significant amount with payday loans.
Applying for a Payday Loan is Time Consuming
If you are interested in getting a payday loan, you will be very happy to learn that the application process is very fast and convenient. In fact, filling out and submitting one of these applications usually only takes several minutes. You will be able to fill out the application online on the lender’s website. The more prepared you are when it comes to having the necessary information ready, the faster it will go. You will need to submit personal and financial details that will make it easy for the lender to decide whether or not to approve your application.
Final Thoughts
Most people feel a lot more comfortable with applying for a payday loan after they have gotten all of the facts. You don’t want to let misconceptions about these loans keep you from getting the money you need. If you have an important expense but don’t have the cash to pay for it right now, a payday loan can be a great way to solve your problem. This type of loan is basically just an advance on your next paycheck. Once you have all the information on these loans, it should be much easier to make a good final decision either way.