Payday Loans Direct Lenders

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Representative APR: 279.5% | Representative Example: Loan Amount: £300 | Borrowed for 60 days | Total Repayment: £420.82 in 2 monthly installments of £210.41 | Interest Charged: £120.82, interest rate 120.8% pa (Variable).

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Fast Payday Loans, Direct Lenders and What You Need to Know

Most people know a great deal about personal loans, mortgages, and car finance, but when it comes to payday loans/direct lenders there are a lot of misconceptions about what they are and who will gain the most benefit from them. The rest of this article will go into more detail about payday loans, direct lenders, and how and when you should apply.

Payday Loans Versus Personal Loans

The main differences between personal loans and payday loans are the level of financing and the terms of the agreements.

A person seeking a personal loan will usually require more substantial sums with longer repayment terms than someone who is looking for a quick cash injection to get them over a hump. Payday loans are traditionally smaller sums of money with a lower capped limit than personal loans.

What is a Payday Loan from a Direct Lender?

Payday loans from direct lenders are short-term loans designed to be paid back in full once the borrower receives their next paycheck, with repayments also including a service fee and additional interest.

Alternative arrangements can be made for borrowers who may be unable to repay the loan in full. However, careful consideration of fees and interest rates is required.

The amount you can borrow on a payday loan will depend on your income. People who earn more in a full-time job will naturally be able to borrow more, as your employment means you are less likely to be putting yourself in financial hardship. If your regular pay does not leave much of a disposable income, then your borrowing capacity will be limited.

Payday loan’s direct lenders maintain strict borrowing standards by limiting people only to what they can comfortably afford to pay. The goal of a payday loan is to help people out of a tight spot, not put them in the way of more financial hardship.

If you need money in an emergency and before your next pay arrives, then a payday loan is an excellent solution that can give you access to cash fast. For example, if your rent is due and your car needs an emergency repair, but your reserve funds are tied up in your share trading account, a payday loan can be useful for getting you out of your predicament.

utilising payday loans from direct lenders

How Should I Be Utilising a Payday Loan from a Direct Lender?

You will often hear payday loans referred to as ‘small loans or ‘cash loans,’ but they are all referring to the same system of short-term financing. They are a convenient solution if rent is due, or school fees need paying as they don’t require a lot of paperwork. In a lot of cases, you will be able to access your funds on the same day and in as little as a few hours or minutes.

The most important thing to keep in mind is that a payday loan provides for a modest cash injection that you really need. Such as, catching up with rent or paying for much needed car repairs. On the other hand, they’re not deemed a suitable option for a weekend away or a new car stereo.

The payday loans system is designed so loans are quick and easy to get but can also be paid back almost as quickly in one or two weeks. They may be fast to acquire, but the higher interest rates mean they are not an economical solution for anything but emergencies.

Who Can Apply for a Payday Loan with a Direct Lender?

The nature of payday loans means that the unemployed may be better off searching for another solution. Low wage earners with income that is supplemented by unemployment payments would also be unlikely to improve their situation through payday loans. But, how do you know if you are eligible for a payday loan?

Payday loan’s direct lenders are generally more flexible than other forms of finance. It’s for this reason that the interest rates are much higher than they would be for a personal loan because the risk of default is greater.

However, the criteria for who will qualify can vary quite a lot between lenders. Some may approve finance for the unemployed, while others will not. Many lenders will loan money even though the borrower may not have the best credit history. Some lenders have policies in place which do not require them to check credit histories.

There are standard requirements payday loan providers need to adhere to before they can loan money to an applicant. Namely, applicants must:

  • Be over 18 years of age

  • Have a stable income

  • Be able to pay off the loan

Should You Apply for a Payday Loan if You Have Bad Credit?

When you apply for a loan that requires a credit check, being rejected by the finance provider can further hurt your credit rating.

Payday loans are often not subjected to credit checks. On the off chance your payday loan finance is rejected, your credit check will remain intact because no search will be recorded against it.

If you have been applying for finance elsewhere and keep getting rejected, it is advisable to stop putting in applications. Each time you are refused finance weakens your ability to apply for finance in the future successfully.

Think about your options if you’re considering applying to another credit card or personal loan provider after several unsuccessful attempts. If lenders see numerous attempts at finance in a short space of time, they might think you are desperate for money and consider you too high a risk.

In these circumstances, if all you need is a small amount to tide you over until your next paycheck, then a payday loan may save you the trouble of doing further damage to your credit rating.

Using a payday loan with direct lenders to pay off debt

Should I Use a Payday Loan to Pay off Debt?

In most circumstances, paying off a loan with another debt will not make financial sense. Payday loans aren’t suitable as a solution for solving a debt crisis. Instead, you should seek help from a financial adviser or consider a consolidation loan.

Consolidation loans are designed to help people get out of crippling debt by paying off all other loans. You do this by combining all repayments into one easy to manage monthly payment. They’re also usually provided at a lower or comparable interest rate. Free debt advisers are available if you have found yourself in the type of financial hardship a payday loan will not solve.

Payday Loan Advantages

The major drawcard of a payday loan is that you get fast access to cash. Having same day service makes sense given that payday loans are most often required in emergencies.

Another significant advantage is that no credit checks are required. This saves you the hassle of damaging your credit rating should you not be successful.

A payday loan does not require collateral or an assets test. This means you don’t have to put your car or house up as security against the loan. Of course, there will need to be some assurances that you can afford to pay back the debt. However, your income statements will usually provide the lender with the information they need.

Limitations of Payday Loans

The payday loan market in the UK has grown in recent years. Current numbers are hard to pin down, but in 2009 more than 1.2 million people took out more than 4.1 mill loans.

The whole reason behind a payday loan is to provide emergency cash. However, it’s always good to know the risks so you can practice responsible borrowing.

Payday Loans Normally Attract Higher Interest Charges

Payday loan’s direct lenders typically take on higher risk debts than a mortgage or personal loan provider. Due to this, the interest rate on payday loans is higher.

Before you commit to a payday loan, you need to make sure you can repay the principal and interest. This is so you don’t attract higher fees.

Short repayment terms can be both a blessing and a curse. While a fast repayment ensures the minimum amount of interest is payable on the loan, borrowers need to ensure they only borrow within their capacity. So it’s best practice to try and repay within 2 to 4 weeks or face higher fees.

Using payday loans to solve an emergency isn’t all that convenient if the repayments are only going to cause you further financial hardship.

Payday loan’s direct lenders don’t just check credit ratings, which can be advantageous. However, repaying a payday loan doesn’t always have that sway at improving your credit rating. This is because not every payday lender will report your diligence to the credit bureaus.

Consider the below before apply for a payday loan with any direct lenders

What Should I Consider Before Applying with a Payday Lender?

When people are in an emergency, they are often overwhelmed. However, when it comes to payday loans, it is essential to consider every angle before signing the application. Here are a few tips to make your loan request go a lot smoother.

Consider the Purpose of the Loan

Think carefully about why payday lenders make loans available to the public.

The loans are designed to be used as an emergency measure for people who have exhausted other avenues. The loans are not meant to be used as a regular source of money like a credit card or revolving credit.

Instead, they are short-term solutions that help people who need money fast. For example, for repairs that need immediate attention or to cover the week’s rent to avoid eviction. Remember, defaulting on a payday loan may be making your situation worse, and that is not what the lender wants.

Only Borrow as Much as You Need

If you’re in an emergency and are considering a payday loan, make sure you only borrow as much as you need to get yourself back on track.

While payday loans are an essential resource people need on occasion, keep in mind that the money you borrow but don’t need is only costing you extra in fees.

Some lenders will allow you to add a little on top of the loan. However, they prefer you to have paid off a significant portion of the current loan before allowing you to apply for more finance.

Know Your Limits

When you know how much you need to borrow, you will be in an excellent position. You’ll understand your repayment limits and will also know how long you can take a loan out for.

If you need £200 but can only pay back £100 from your next paycheck, you should consider asking the provider if you can extend the loan duration. Of course, you will be charged extra interest, but this is preferable to attracting expensive fees because of late payment. Keeping your repayment commitments lower will mean you won’t get out of step with your other financial obligations.

Always read the Terms and Conditions

Once you sign on the dotted line, you are obligated to comply with the terms of the loan. Pleading ignorance will not get you out of trouble if there is something in the contract you did not fully understand.

Always know what you are signing up for exactly, and make sure you understand what everything means. All payday loan’s direct lenders will have their own terms and conditions. If you have used one in the past, do not assume that the terms and conditions will be the same for the current loan you want.

We have multiple payday loans options and direct lenders all under one roof

A Copious Range of Payday loan Lenders at Loanbird

There are many payday loans direct lenders in the short-term money market. They are all different in terms of quality of service, reputability, and reliability. So, how do you find a lender that has your best interests in mind?

Most people will start with a search online, but this will usually result in a confusing list of many different lenders with no real way to separate the wheat from the chaff. Fortunately, there are sites you can use, which provide a portal to many different lenders from one convenient location.

Loan bird uses smart search technology to help you find the best payday loan’s direct lenders fast and get emergency cash even quicker. And the best bit is, the service is free for you to use. A lender pays Loan Bird a small referral fee upon a successful application, but this is paid by the lender and is not transferred onto the customer.

The site also provides plenty of great advice about payday loans and provides a quick and painless three-step process for you to apply to many different vendors at once. Whether you want access to cash fast, or a looking for larger amounts over longer terms, check out Loan Bird today. Your times important, so let us do the search on payday loan’s and direct lenders for you.

Representative APR: 279.5% | Representative Example: Loan Amount: £300 | Borrowed for 60 days | Total Repayment: £420.82 in 2 monthly installments of £210.41 | Interest Charged: £120.82, interest rate 120.8% pa (Variable).

Our website is completely free for you to use, but we may receive a commission or fee from some of the companies we feature or introduce you too.

Loanbird.co.uk is a registered Trading Name of RJW Assist LTD. RJW Assist LTD is registered in England and Wales (Company number: 09470548). Registered Address: Brook House, 40 Cuthbert Road, Stockport, Manchester, SK8 2DT. Licenced by the Information Commissioners Office: registration number: ZA436430. RJW Assist LTD is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register under the reference number: 788094. We are a licenced credit broker, not a lender. Loanbird.co.uk does not provide any loan or consumer credit products directly.

Timescales on receiving your funds may vary from lender to lender and depends if your bank accepts faster payments. The loan amount and interest rate offered is subject to the lender’s requirements and approval.

Warning: Late repayment can cause serious money problems. For help, visit moneyadviceservice.org.uk