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Payday cash loans - Short term loans

When in need of urgent cash, a payday loan might be just the solution.

Payday loans are short term loans that are intended to cater to an emergency need for cash that occurs before you receive your next salary, in effect giving you a cash advance.
The loans are small in nature; typically from £50 to £1000 and the approval process is quick; usually you get the money on the same day you applied.


How they work
You provide the necessary details online, if you qualify, the money will be deposited directly into your bank account.
You are expected to repay the loan in full when you receive your next salary; usually this means within 31 days, although some lenders might allow you to defer the loan to the next month.


Requirements
Lenders' requirements may vary slightly, below is a list of lenders and a summary of the loan, see lender's website for full details on the loan.

Lender Loan Amount Loan Term Cost of Credit Requirements
Payday Express
 		From: £80
To: £800 		Up to 45 days 25%
e.g. £80 borrowed = £100 repaid 		- Over 18 and a UK resident
- In full-time employement
- Bank account with direct debit
Payday Bank
 		From: £80
To: £750 		Up to 31 days 25%
e.g. £80 borrowed = £100 repaid 		- Over 18 and a UK resident
- In employement
- Bank account with direct debit
Lending Stream
 		From: £80
To: £480 		Up to 31 days 25%
e.g. £80 borrowed = £100 repaid 		- Over 18 and a UK resident
- In full-time employement
- Bank account with direct debit


Advantages

  • Bad credit history not an issue; for a payday loan, the most important thing is your ability to pay back the money on your next payday. In some cases no credit check is done.
  • Fast approval; you can have the money on the same day you apply.
  • Convenience; whatever your emergency, these services will provide you with the needed cash until payday comes.
  • Payday cash loans are unsecured, therefore they pose no immediate risk to your property; they are available to tenants and homeowners.

Disadvantages

  • Although they are convenient when you need the money, a major drawback is the fact that you have to pay the money back in one instalment, this can be a problem if your salary is not big enough to cover the loan as well as your other expenses.
  • High interest; most lenders charge around £25 for every £100 borrowed, this is a much higher Annual Percentage Rate (APR) if compared to normal loans. However, considering the fact that payday loans are short term, the cost of borrowing is not that different from normal loans.

Alternatives

1. Friends and family
Have you considered borrowing from your friends or family members? If one of them can lend you the money you need, that would be better than a payday loan; your friend is unlikely to charge you interest, they also understand your needs better than a financial institutions can.

2. Small cash loans:
These are also unsecured loans similar to payday cash loans, but are paid back over a longer period. For more details see: small cash loans

3. Pawnbroker loans:
Pawnbroker loans are secured against items you own; this can be jewellery or electrical devices: You deposit your items in order to get the loan, once you repay the money you get your items back.
The advantage is that you might get better interest rates since the loan is secured against something unlike a payday cash loan.

Pawnbrokers primarily operate on the high street and can be found in town centres across the UK.



Related pages:
Loans for people with bad credit - Adverse credit loans
credit cards for people with bad credit - Prepaid credit cards