What Makes Cash Loans Safe and Secure These Days?

Cash loans came on the market in a dodgy manner. Basically, you could get anywhere between £100 and £500 on average – more or less, depending on the lender. The fees were quite high, but people with low debts or high affordability faced no issues …

Cash loans came on the market in a dodgy manner. Basically, you could get anywhere between £100 and £500 on average – more or less, depending on the lender. The fees were quite high, but people with low debts or high affordability faced no issues whatsoever. Then, those who failed to pay ended up in more and more debt. In other words, a cash loan was not the best option if you failed to consider your options.

However, things have changed a little. Cash loans are now regulated. In 2016, the FCA has decided to step in. Lots of people ended up with more debt than they had initially. Fees were pretty clear, but there were hidden charges that overwhelmed them. The FCA has come up with a series of strict rules and regulations. Most of them were rigorous and hard to pass, which was excellent for the consumer.

These days, most lenders are regulated and have to follow a code of conduct. From this point of view, it is critical to make sure your lender has a valid license and is thoroughly regulated by the FCA. When it comes to the rules, what are the most important ones to be aware of?

Interest Rate Limits

Interest rates used to be pretty high a decade ago, but things have changed since the FCA has stepped in. These days, lenders are limited. They can only add 0.8% a day. In other words, if you borrow £100 for a couple of days, the interest rate cannot exceed £1.16 for this time frame. Some lenders rely on lower rates to attract customers. Obviously, it depends on how much time you need to repay the loan.

Back before the FCA regulations, interest rates were the most annoying factors in the process. Customers were forced to pay a fortune in order to overcome their emergency debts and many of them ended with even more trouble.

Penalty Fees Regulations

Penalty fees applied for consumers breaking the agreement. You had to make a payment on the third of each month. You missed it, you got charged. These fees could be quite problematic. If you let them add up, they could have overwhelmed you. Things are much better now.

A fee or a default issue cannot exceed £15. If you end up defaulting, the lender can keep charging interest. However, the rate will not change. It will stay at the exact same rate as when the loan started. There will be no changes.

No Doubling Up

Some people used to get £100 or £500, only to end up paying more than double back. The interest rate was pretty high. Then, there were fees and lots of charges, which could easily skyrocket the repayment plan. These days, the FCA has agreed that any charges and interest rates cannot exceed the initial amount.

Simply put, if you take out £500, you will never have to pay more than £500 in default fees, charges, taxes and interest rates. You know for a fact that this is the maximum limit your fees can go up to – just in case you actually end up struggling to repay.

Final Words

These new rules implemented by the Financial Conduct Authority have cleared out the scum and made room for genuine lenders. These days, chances to get ripped are close to nor. If a lender is not registered with the FCA, its operations are illegal. This is the main reason wherefore you must ensure that you borrow money from regulated credit providers only. Sure, you may find better rates here and there, but this should be your main priority.

How to Make Cash Loans more Affordable on a Monthly Basis?

Cash loans – often referred to as payday loans too – represent a quick way to get some cash on your hands. Whether you rent is due two days before getting paid, your car needs a quick fix or you have a terrible toothache that …

Cash loans – often referred to as payday loans too – represent a quick way to get some cash on your hands. Whether you rent is due two days before getting paid, your car needs a quick fix or you have a terrible toothache that just cannot wait, cash loans are the way to go if you have no savings. Practically, you come up with an application over a few minutes, get accepted and have the money transferred to your account over a couple of hours.

It sounds easy. Cash loans are pretty straightforward – no funny costs and fees if you read the terms and conditions. Some people may end up in trouble though. Such lenders are now regulated by the FCA, so they follow some strict rules. It is up to you to pay attention to these rules too – as a consumer.

At this point, it is critical to understand how much you can afford to repay on a monthly basis. This is where most people struggle. Even if it feels tight, some people see it differently – they will see what they will do. They go with the flow and adapt on the way. Bad idea. So, what should you keep in mind?

Monthly Payments Versus Loan Duration

It is hard to tell how much you can pay back each month if you do not know the duration of your loan. Ideally, you should pay everything back once you get paid, but most people do it over a few months, especially if the amount is more than just £100.

Your monthly payment depends on the duration of the payment. If you borrow £500 over five months, you will pay £100 a month, as well as the interest. If you get the same amount over one month, you will pay a lower interest and the £500 in one go.

When to Reject a Loan?

Say you want to borrow £500 over four months. You do some calculation – your income, expenditure, potential extra expenses, leave yourself some room for extras. You end up left £25 short a month. You probably imagine you can cut on some expenses – no more takeaway and restaurants, but more cooking at home. Forget about going out three times a week – do it twice only.

Either way, if based on your current lifestyle, you are even or at least £1 short, you should refuse the payment. Some lenders will offer it to you, yet the risks are too high and you may end up with more debt. In other words, you dig your own hole, so start negotiating.

How to Make a Cash Loan Affordable?

Instead of making compromises or hoping for the best, simply ask the loan provider to give you more time to repay the loan. You might be able to get the same amount of money. But paying over more months will reduce the monthly expense. Therefore, you are less likely to get in even more debt.

More Time versus Higher Interest

It is important to know that expanding your cash loan over more months will decrease the monthly payment. It sounds like a more affordable choice, but a longer time will also bring in a higher interest rate. Proportionally, while the monthly payment is lower, you will pay more money back in the long run.

Final Words

Bottom line, cash loans could be a fresh breath of air when you struggle with an emergency. But on the same note, they can also get a bit risky if you are not responsible. The secret is to take your time and plan your loan in the smallest details.

Three Major Considerations When Thinking About Payday Loans

Payday loans represent a common necessity these days, whether it comes to a medical emergency, a car repair, some servicing or perhaps an unexpected shopping session. All in all, payday loans may seem easy at first, whether you are after £100 or £500, but then, …

Payday loans represent a common necessity these days, whether it comes to a medical emergency, a car repair, some servicing or perhaps an unexpected shopping session. All in all, payday loans may seem easy at first, whether you are after £100 or £500, but then, not everyone might be approved. In fact, there are some criteria you must meet. All in all, here are a few tips to increase your approval rate.

Consider the Basic Loan Criteria

This is the first aspect to take into consideration. However, lots of people are more focused on getting the money as quickly as possible, rather than actually paying attention to the loan criteria. Most lenders will get back to you if you fail to pay attention to everything. This only means you are wasting time. Instead of getting your money in a few hours, you will need to come up with more documents.

Most commonly, credit providers will consider the circumstances for the risks of not being able to pay. Therefore, the main criterion involves being in employment. If you do not have a job, it is not really a payday loan, is it? At the same time, if you apply for a lender in the UK, you obviously need to be a UK resident. You should have a UK bank account for the money to be transferred to.

Consider the Affordability Criteria

Your personal finances dictate this aspect when considering payday loans. While lenders will do it too, it is mostly your responsibility. Consider your net income on a monthly basis. Consider your monthly expenditure, from rent and bills to socializing and other habits. Any regular expense should be included.

Do you have enough income left? Would you be able to repay the loan? In the attempt to make sure they get the money, lots of people tend to lie in these statements. They reduce some of their expenses, such as rent or perhaps some utility bills. While lying might help you get the money easier, it will not help you in the long run.

You risk not being able to pay, meaning you risk lots of fees and taxes. Sure, these companies are regulated by the FCA now, but fees may still occur to a particular limit.

Consider Your Financial Situation

At this point, a little responsibility is mandatory. If you have struggled with long term money issues, a payday loan may not be the best option. The same rule applies if you have an increasing level of debt. A payday loan could help over the next few days, but you will get in even more trouble later on.

Furthermore, lenders will look at these issues. If your personal debt keeps going up, most lenders will lose confidence in your capability to repay the loan. Simply put, a payday loan will make the problem way worse. It might come disguised as a short term saviour, but you will end up with even more debt.

Final Words

As a short final conclusion, payday loans represent a good choice when you are out of cash. No matter what you need some money for, a payday loan could bring it within a few hours. You must, however, make sure this is only a temporary problem – an emergency, an unexpected situation or just a matter of bad timing. Under other circumstances, you should be able to handle it.

Seeing a payday loan as a temporary issue is the way to go. It should not affect your debt and you must be able to cover it once you get paid. Otherwise, it could get you in even more trouble.

When Do You Actually Need a Payday Loan?

Payday loans represent a quick and easy way to get some cash on your hands. This is not the type of loan you get to buy a new car or perhaps a home. Instead, it is suitable for small expenses that simply cannot wait. Here …

Payday loans represent a quick and easy way to get some cash on your hands. This is not the type of loan you get to buy a new car or perhaps a home. Instead, it is suitable for small expenses that simply cannot wait. Here are some of the most common situations wherefore you might need to apply for a payday loan.

Unexpected Bills

You have just received a bill that you forgot about. Perhaps your phone bill has doubled up, as you had to make some urgent international calls. Or maybe your heating bill is way higher than normally – last month was a bit colder than usually. No matter what kind of bill you receive, a payday loan will get the money in your account within a couple of hours only. Therefore, you can get rid of it without risking any fees.

Medical Emergencies

Got a medical emergency? A bad tooth? A toothache that you simply cannot delay? Whether it is a more aggressive flu that keeps you off work for a week or you simply end up with a broken arm, medical expenses can add up. Sure, most of the treatment could be free, but you will still have to spend some money on transportation, medication and so on.

Bad Timing

If your rent is due on the first day of each month? If it falls on a weekend day, some companies charge it the day before. But what if your employer pays you on the next Monday? What if the rent is due a couple of days before getting your wages, only because of a bank holiday? What if you are paid weekly and your planning is messed up because of a day or two?

A payday loan could help you prevent unpleasant calls from the landlord or perhaps some fees. You will get the money within hours only. You can pay it back as soon as you get the wages. Obviously, the interest and fees will be insignificant over a few days.

Shopping Sessions

You kept an eye on those boots for months. The season is over, so you are expecting a discount. You keep checking them on a daily basis and you notice a 50% discount just a week before getting your wages. You know that by the time you get some cash in, your favourite boots will be gone. It makes no difference if it is one thing in particular, Black Friday falls days before your wages come in or the Boxing Day is at the wrong financial time of the year for you.

A payday loan can help you get your hands on some nice things without having to worry about waiting for your wages. Make sure you pay the loan back as soon as you get your money, only to prevent further fees and expenses.

All Kinds of Emergencies

Pretty much any type of emergency can do with a payday loan, especially if you are out of cash and your savings account is not in the best condition. Maybe your best friend has a baby and you need to buy a gift. Maybe you forgot about your parents’ wedding celebration. Perhaps your car needs a quick fix – you need it to go work, so you cannot delay it.

Final Words

Bottom line, payday loans may not be suitable for all kinds of needs – definitely not for large amounts of money. However, there are many situations when they can make the difference between a peaceful result and a disastrous situation. Make sure you go through all the terms and conditions and you fully understand them before making a commitment.

Five Benefits of Payday Loans That Show How the Industry Has Changed

You have heard about payday loans. You see ads and billboards, but you have never really been involved with them. You know they are referred to as short term loans, meaning you get a particular amount of money that you should be able to cover …

You have heard about payday loans. You see ads and billboards, but you have never really been involved with them. You know they are referred to as short term loans, meaning you get a particular amount of money that you should be able to cover it with your wages. Now, the main question is – are they really worth it?

Apart from getting a bit of money to keep yourself on the floating line, a payday loan will bring in a plethora of other advantages. So, what makes these loans so popular?

Quick Results

Payday loans do not involve getting to a bank, waiting in a queue, applying and waiting for days or even weeks for a reply. Instead, you usually get your application approved or rejected within minutes only – sometimes, even instantly. Then, money goes to your account within a couple of hours. Simply put, you get a good amount of money for emergencies, be it a car repair or rent.

It is worth noting that the speed of your application decision is based on providing the right documents and details.

Convenience

Forget about banks, letters, documents, prints, queues and so on. More and more lenders stick to online payday loans only. In other words, you sit down on your sofa, complete the application on your smartphone or computer and send it. You do not have to leave the home. You only need an Internet connection.

Discretion

Discretion is quite common these days, but doing it online provides even more privacy. Sure, you will have to provide real details, such as your name or payslip details. But then, you can avoid showing up in person. You do not have to discuss face to face with a manager. You do not need to borrow money from friends or family. You can take care of your financial issues and keep your reputation clean.

Good Rates

Pay your loan on time and you should have no issues whatsoever. Build your credit score up and show the lending institution that you are a reliable customer. With time, your credit limit will be increased. Assuming that you are still employed and you can pay the debt, your credibility will go up.

As a first time customer, you will be lucky to get £500. Most lenders allow smaller loans. As you keep repaying on time, you are more likely to get up to £1,000 or even more.

Well Regulated

Payday loans do not have the best reputation out there. Times are different now. Back then, the industry was quite problematic. Fees were high. There were all kinds of brokers selling these loans and many of them sold the customers’ data to call centres and so on. Luckily, the FCA (Financial Conduct Authority) has decided to put an end to all these problems.

Rules are quite strict these days. Reputable companies have managed to stay on the market, while the scum is mostly gone. Obviously, you still have to pay attention and research your lender. But then, there are price caps regarding charges and fees, meaning your extras will no longer explode.

Simply put, if you are after a payday loan, you can now enjoy a well-deserved peace of mind. You will work with well-regulated lenders and charge the right fees.

Final Words

Bottom line, payday loans represent a completely different industry these days. Despite being plagued with scams and huge fees for years, most of the scum is gone since it was properly regulated by the FCA. It makes a good alternative for those who need some quick cash for emergencies without ruining their credit scores or reputation.