Payday loans get a lot of bad press and many people are every opposed to them. They have been blamed of taking advantage of the most vulnerable people, but there are some people who have found them very useful. If you are considering a loan, then it could be a good option for you, but it is worth making a very careful decision.
Payday loans tend to be very expensive. This means that it is always worth hunting for cheaper alternatives before you sign up. So if you can use an overdraft, credit card, personal loan or borrow from a friend it could be worth trying this first. However, do compare the price, if you have these options as they may not be cheaper. An overdraft can be more expensive than a payday loan if it is unauthorised, so do check. If you need the loan for paying a bill, phone the company first as they may allow you to reduce how much you pay or allow you to have a short break from paying until you get some more money.
If you have a poor credit record then you may have no choice if you want to borrow money than going with a payday loan as they do not run credit checks. Therefore for you, this could be the only option if you are stuck for money. However, it is wise to make sure that it is completely necessary for you to borrow money and that you have no other options as getting a loan can make things even more difficult.
A payday loan has to be paid back in full very quickly. You borrow a relatively small amount and it is expected that you pay it all back, plus the fees when you next get paid. Therefore you need to be sure that you will have enough money to pay it back, when the repayment is needed. If you are not able to pay it all back, then you will be charged fees and these can be really high. They can even accumulate each hour or each day that they remain unpaid. It is therefore wise to only take out a loan if you are completely sure that you will have the available resources to pay it back in full when required.
As with all loans you should not take out a payday loan unless you have thought about it very carefully. You want to make sure that it really is the right option for you as it will be expensive. Think about whether there is an alternative to borrowing and also whether you really need the money or whether you can wait. Payday loans were set up to provide money in emergencies and this is exactly what you should be using them for and so if your situation is not an emergency then it is worth not borrowing the money and waiting. If you are about to be cut off, evicted or have no food then this would be an emergency but if you need to buy something that is not necessary then it is wiser to save up for it.
So if you are looking to get a payday loan it is worth stopping and thinking hard about it first. Consider whether borrowing money really is necessary for you as you may be able to wait and then not pay the cost of a loan. Then think about whether you should use a payday loan or if there is an alternative method of borrowing that you could use that will be cheaper for you. There may be options for you if you have a bad credit score such as Emu.co.uk, but it is worth checking first and looking around at the options. Do not assume you will not get help elsewhere, ask and find out.
Also think carefully about the cost of the loan. You may be able to compare different companies and it is wise to look at their fees. Do not only compare the upfront fees but also the costs if you do not repay on time. It is also worth finding out more about the company and the customer service that they offer. Once you choose a lender and know what your repayment amount will be, make sure that you are confident that you can repay it. Think about your income and whether you will be able to afford to repay it as well as cover your other monthly costs. There is a lot to think about, but it is an important decision as you could find that if you choose the wrong loan or cannot repay it, you will get into deeper financial difficulties. Do not panic about needing money but give it some serious thought as you may otherwise regret the decision that you made.