Payday loans fill a void that is apparent in society where some people do not have access to credit. This includes credit cards which may not be attainable because of low credit scores, bad credit history or income that does not meet the parameters of Mastercard or Visa.
In spite of the fact that many in this group is hardworking, is in good standing on a reputable job where they have worked for a long time for a long time, and is very presentable, they are unable to secure needed quick cash to pay their bills or get funds for an emergency.
This is where companies that provide payday loans and other short term loans come in handy. They provide quick cash to borrowers based on their having a reputable job and good work history. The loan is secured by their paycheck and is deducted along with the interest, from their pay until it is paid off.
The upsides for this type of loan is that virtually anyone with a good job will receive a loan. The loan amount is contingent upon how much the person earns. They are also very quick with some companies providing loans that same day. Certainly if there is a track record of the person paying off loans with that payday loan company, the loan can be provided even quicker.
With this said however, the downside is the interest rate charged which is typically quite high. There will also be fees that are added into the cost of the loan, making payday loans only ideal for short term critical situations or those situations where you are 100% sure that you will not create a big hole for yourself.
The companies that provide payday loans differ and so do their terms. Here are the terms you should look for when considering a payday loan.
Easy to Use Service
The payday loan service you use should be a breeze to use and provide you will online tools to manage your account. A great example of an easy to use company is Cashfloat.co.uk. They have an online service that provides you with a wonga login to access and manage your payday loan account. You can access it from anywhere and on any Internet connected device.
Possibility of Early Repayment
Loans charge you based on the time the money is out. The longer the time, the more you will pay. Therefore having an option to pay off the loan early will allow you to save money on interest. The right payday loan will give you this option.
Helpful Customer Service
Many payday loan companies do not have helpful customer service departments. Taking out a loan is serious business and you will likely have questions that need helpful answers. You should be able to talk to someone about your concerns and feel like that are interested in getting you the answers you need.
Grace Period if You Miss a Payment
In life sometimes things happen that are out of your control. When this happens with a payday loan, you should not be penalized before being given an option to correct things. If you are scheduled to make a payment and for whatever reason you are unable to make it, there should be a grace period before you are penalized. You should seek up to 5 days for this grace period.
No Selling of Your Personal Data
Many people find that when they get a payday loan, they get bombarded with marketing calls, and advertisements from all sorts of businesses they have no interest in. this happens because the payday loan company has sold the customers data to marketers. The payday loan company you choose should never sell your data without your permission.
An FCA Interest Cap
The Financial Conduct Authority (FCA) is the conduct regulator for 56,000 financial services firms and financial markets in the UK and the prudential regulator for over 18,000 of those firms. They provide guidelines and caps for the interest rates that reputable payday loan companies can charge. The payday loan company you choose should adhere to these interest cap guidelines.
With this knowledge you are now able to pick the payday lender that is the best for your needs.