Are Payday Loans the Best Choice for Emergencies

If you need money in an emergency it can be easy to panic and quickly grab the first opportunity you can think of to get the money that you need. Sadly, this can lead to problems as it could be that you choose an unsuitable option because you have not had time to look through them all. Therefore, it is a good idea to plan in advance. Hopefully, most people will not be in a situation where they need money in an emergency, but there could be a chance that it will happen and if we are prepared, then we will be able to deal with it a lot better. There are lots of possible options we could take and a few of them are described below.

Use Savings

If you have any savings then it can be a good idea to use these rather than borrowing money. This is because you will find that it will be a lot cheaper to do this. Although interest is paid on savings, there is interest charged on loans and sometimes fixed fees as well. This means that you will normally end up paying more for a loan that you will receive on savings. It is worth checking this and if this is the case then it will be cheaper to use savings. It can be hard parting with our savings, especially if we have spent a lot of time saving hard or we were hoping to spend them on a specific thing. However, if you are determined, you could replenish them once you get past this emergency situation.

Credit Card/Store Card

If you have a credit card or a store card it might be able to help you out. Even if the money that you need cannot be provided using these cards, you might be able to use them to pay for other things and that will free up money that you can use for the emergency. For example, if you pay for your food with a credit card, then you will not need to find the money for that food so you can use that money instead to pay for the emergency. It may not be as simple as this, but it can worth thinking about. You can also draw out cash form an ATM using a credit card which might be helpful, This can be expensive though as you will start being charged interest right away and this means that you will need to check the cost and make sure that it will be a cheaper option compared to the other options that you have available to you.

Overdraft

An overdraft is something that many people have with their current account and the money can be access by drawing cash form an ATM, using transfers or other ways. It can be convenient but it is expensive and you will again, need to see whether you feel it will offer you good value for money.

Payday Loan

If you have a poor credit record or have maxed out your overdraft or credit card, then payday loans might be one of the few options that you have. However, it can be wise t plan carefully and make sure that you have other options. So, try not to max out your borrowing or do what you can to improve your credit rating and then you might be able to get a credit card to keep handy in case of an emergency. A payday loan only helps in the short term as it will only allow you to borrow money until you next get paid. This means that you will need to think hard about whether you will really be helped by this type of loan. You will need to pay it back in full within a few weeks or days and this means that you will need to be well prepared and make sure that you will be able to afford to do this and manage the rest of your bills as well.

Can I Use Online Loans to Pay for a Holiday?

We might have a lot of questions when it comes to online loans. This is because we may not really be aware of how they work and who they are for as well as what they are for. However, some questions are better addressed with regards to more general borrowing before we think about the specific type of loan that we might be considering. For example, in this case, it is wise to ask whether you should borrow for a holiday and then think about whether there will be specific loans that might work, assuming that you do decide to borrow in the end.

Should I Borrow Money for a Holiday?

We borrow for all sorts of reasons but it is always worth making sure that we think hard about our borrowing decisions before we go ahead with any borrowing. This is because loans cost money and they also have to be repaid. Sometimes this ca be difficult and cause us stress and therefore we should try to avoid them if we feel that they will not give us good value for money and if they will make us feel stressed up. Therefore, we should think carefully about borrowing.

Good borrowing is when we have carefully the decision. We have thought about whether borrowing is really necessary. So, think about the holiday and whether you really need it. Consider whether it might be better to not go on holiday and save the money. Also think whether you can wait for the holiday and save up money so that it will not cost you so much money. It is a really good idea to get an idea of the approximate cost of the loan and then you will be able to think about whether you are prepared to pay that extra money as well as the price of the holiday. Then you will be able to make a decision about whether you that it will still give you good value for money even if you take out the loan.

It is also a good idea to think about whether there are alternatives to borrowing. So, assuming you still want the holiday, you might be able to think of another way to pay for it. For example, it could be a good idea to look at your spending and see whether you can cut down anywhere so that you free up some money that you will be able to use to pay for the holiday. You might be able to compare prices on the things that you buy and this might be able to allow you to save up. You might also be wise to ask yourself whether you need everything that you are paying for or whether you can go without a few things so that you can put that money towards the holiday instead.

It might be easier for you or you could also consider ways to earn soe more money. You could do this in different ways. Some possible ideas are to try to work more hours in your current job, to find an additional job or to look for temp or freelance work. You may even be able to find opportunities to earn money online which you can do from home. 

How Can I Pick the Best Loan?

If you do decide to use a loan, then you will need to make sure that you pick one that suits your needs really well. This will mean that you will need to identify what your needs are and that will allow you to match to the best loan. You will need to know the main features of all of the loan types and then you will be able to make that match well.

Do All Lenders Use Credit Scoring?

It can be a worry, if you know that you credit record is not good, to think that you will not be able to borrow any money as a result. Although borrowing should normally be done as a last resort, it can give us peace of mind to know that it is an option available to us and that we can use it if we really need it. It is good to be aware though, that not all lenders use credit scoring and so there will be borrowing options available even if you have a poor credit rating and will not be able to borrow using traditional methods. Examples of the types of borrowing you can choose from are

Payday Loans

A payday loan is a very short term loan. You will normally be able to borrow between £100 and £1,000 and you will be able to keep it until you next get paid. A direct debit will be set up so that the repayment is taken from your account on the day that you are paid. This means that you will not forget to repay, but you will need to find the money to repay everything that you borrowed plus the interest and fees, so that you will be able to avoid any extra charges. The loans can be arranged very quickly, because it was recognised that a lot of the people applying for these loans needed money for an emergency and therefore, they decided that they would make the loans really quick to arrange. Some lenders will even provide the money within a few hours and others are available outside of normal banking hours so you can get the money that you need at any time.

Instalment Loans

Instalment loans are very similar to payday loans but they have a different repayment system. So rather than repaying what you owe in a lump sum, you can repay in a few instalments. This makes it easier to manage the repayments and it means that you will be able to more easily repay the loan without having to worry about finding a really large lump sum to repay all in one go. However, you will need to think about the fact that as you will owe the money for longer, the loan will be more expensive and so you will need to decide if you are prepared to pay the extra. If it makes the difference between whether you can repay or not, then it will be worth it, as if you cannot repay then you will have extra fees, which could be more than the additional cost that you pay for the instalment loan compared with the payday loan.

Guarantor Loans

A guarantor loan will allow you to borrow a lot more money. You will normally be able to borrow between £1,000 and £10,000 which means that you will be able to use it for more significant purchases. It is repaid over a period of time in monthly instalments as well, which means that you will spread the cost. However, as they take on borrowers with a poor credit record, they insist that you have a guarantor. This is a person that is willing to cover the payments if you are not able to pay them for yourself and has a good credit record. This means that you will need to know someone like this and be happy to ask them to help you out.

So, there are a few options for you if you do have a poor credit record and need to borrow money. However, it is worth bearing in mind that they will be expensive because they are taking on a big risk by lending money to you.

How to Repay No Credit Check Loans Easily

It is a really good idea to make sure that you can repay your loans before you take them out. This is because, if you miss a repayment, you will have to pay extra fees. No one likes to have to pay out extra money and it means that the loan will last longer, so you need to avoid doing this if you can. Fortunately, there are things that you can do which will help you to make sure that you will be able to repay the loan on time.

Find Out What You Need to Pay and When

It is important to know what the expectations are with regards to repayment. You need to know how much you need to repay and when you need to repay it. If you have not yet taken out the loan, then you can check if you can afford this before applying. If you have taken out the loan, you may still be okay but you will also need to calculate whether you can afford the repayment so that you know whether you can relax or whether you need to act to make sure that you do have enough money when you need it.

See Whether You Have Enough

So once you know how much you need to pay and when, you will then need to see if you will be able to afford the repayment. You will need to find your bank statements form previous months and examine them to see how much money you normally receive each month and how much you pay out. Then you will need to take one form the other and it will allow you to see if you will have enough for the loan. It is important to make sure that you include everything that you will need to buy and you will need to think about whether this month will be typical or whether you might have extra things to pay for, perhaps because you need to buy gifts or make payments that you only make annually. If you do not have enough, then you will need a plan.

Plan How to Get More

You will need to identify different methods to free up more money. There are lots of possibilities and you will need to think about what things will suit you. For example, some people will find it easier to spend less and others will find it easier to earn more. To spend less you will need to cut back on how much you are buying. If you regularly buy a lot of luxury items, then not buying these for a while can help you. However, if you only buy essentials anyway, then you will not be able to buy less. However, you might be able to pay less for the things that you do buy. For example, you will need to think about whether you can switch to cheaper brands, retailers, providers, insurers etc to get lower prices.

You may want to focus on earning more. This could involve selling things you own to make money, doing extra hours of work either in your current job or another, doing freelance work or online work.

Have a Backup Plan

It is wise to always have a backup plan. Whether you are confident that you can repay or if you think that you might struggle, you should have a plan. Have an idea of things that you can do to get extra money if you find that you need it. Something from the above suggestions would work and it is important to identify something that you will work for you and be a solution if you need one.

Are Payday Loans Just for Bad Credit?

It is a good idea to make sure that you fully understand a loan, before you decide whether it is for you. This is the only way that you can guarantee that you will get good value for money from the loan that you are taking out. So, if you are wondering whether a payday loan is just for bad credit, it indicates that you do not know lots about that type f loan. Whilst that is not your fault, because we do not get taught this sort of thing in school or adult life, it is luckily something that you can find out. There are places that you can go to learn more about money, such as websites and you can also teach yourself by looking at lender’s websites.

Who are Payday Loans for?

It is good idea to think about what sorts of people might take out a payday loan, based on their main features. It is right that they will lend to people who do not have a good credit record and so those people will be one of the categories that will find the loans useful. However, there are other features which might be useful to borrowers even if they do not have a poor credit record. For example, the loans can be arranged very quickly, sometimes within a few hours. This means that for people that do not have an overdraft facility or credit card or have maxed them out, they might find that they will need to look at something quick, like a payday loan if they do need money in an emergency. With a payday loan you will also repay very quickly. The idea is that the money keeps you going until you next get paid and then you will repay what you have borrowed in full. This means that the loan might only last a few weeks or even days. This can be very attractive to people who do not like being in debt for very long. They may be able to use an overdraft, but perhaps do not trust themselves to have access to that money all of the time because they might keep spending it. The same with a credit card and so they may see the payday loan as a better option. This could also be similar in the fact that with a payday loan you can only borrow smaller amounts. This means that if you do not want a big loan it could be handy. Again, you might consider a credit card or overdraft, but they may have very big credit limits and perhaps you may not trust yourself with that sort of money and feel that you need to just borrow small amounts so that you are sure that you stay in control.

Are They Right for me?

Whether they will work for you will depend on your personal situation and what you are looking for in a loan. It is important to think about what you are looking for with regards to how much you want to borrow, how much you are prepared to pay for the loan, how long you want it to last and whether you have access to all loans with regards to your credit rating. It is also important to think about what you are looking for in a lender too as they vary as well. So, consider whether this matters to you and if you want one that is well known, has good reviews, you have used before, you have heard of, you have seen adverts for or whether you are not concerned about these factors.