Getting credit online is not new but getting cash the same day or within a few hours is a new concept. Sometimes things go haywire and you need some cash to survive till the next payday. Managing monthly payments is a hassle and adding an emergency expense throws your account off-balance. If you are confident that you need quick cash and can pay it back on the next payday then go for direct online lenders.
What’s a direct lender loan?
Direct lender loan is supplied directly by creditors instead of involving a brokerage platform. Direct lender means you get quick loans, but not the best deals because they will not display what other deals are available. Direct lenders work across a wide spectrum ranging from credit cards to payday loans to bank loans.
Credit cards or bank loans need extra research on what’s the current interest rate, terms of the loan, the difference in rate, whether it is fine to repay early, and more. On the other hand, payday loans are simple. Choose the borrowing amount and date to repay because even if FCA regulates payday loans with an interest rate cap the total payable will differ, so use a comparison site before you apply.
For bad credit loans direct lender UK, approach LoanPig to resolve your short-term financial dilemma. Several lenders reject applications with bad credit history but LoanPig understands your issues. They offer a fair playground and allow you to overcome past financial glitches.
Payday loans are also called the same day or short-term or installment loans. You can borrow a small amount for 31 days to 3 months for covering emergency cashflow problems. It is even termed as a bad credit loan because like other credit products, same-day loan availability is not limited to your poor credit history. Payday loans have a single repayment date, while installment loans are spread across a few months.
Direct loan lenders are great, but consider your affordability
If you feel that you will not be able to repay the payday loans then avoid considering it. The interest rates for payday loans or short-term loans are high, so the debt will increase quickly if the loan stays unpaid for a long. If you default then lenders charge penalties. Only borrow the same day loan, if you are capable of paying it on time and this can enhance your bad credit score.
Borrowing activities appear on credit history and late payments are reported to the credit agencies. So, having missed payments, overdue payday loans, or defaults recorded on your credit report can make it extremely difficult to get a loan in the future.
Payday loans and impact on credit score
A payday loan can enhance your credit score but can affect other loan approval differently. Potential lenders can see the loan types you applied for on the credit history. For example, banks can see your recent payday loan application and so assume that you had been financially struggling. And your mortgage application [large loans] can get rejected.
It is fine if the payday loan application is recent, but if it is several years old the bank will ignore it because it does not say anything about your existing financial status.
Apply for payday loans only if you are confident enough to repay it on time!
