Payday Loans

Is Payday Loan Synonymous to No Credit Check Bad Credit Loan?

Payday Loans

Bad credit borrowing entails a lot of troubles for the borrower. Whether you need an emergency loan or an additional fund to repay your existing liabilities, arranging an affordable loan would never be a cakewalk. To ease the troubles, you can, however, use a professional broking advice and reach the desired loan on time.

However, the journey to the goal is more interesting here. If you are considering availing payday cash advance loans as a deal breaker bad credit loan without a credit check, you should know more details about the payday loans.

Payday Loan

Payday loans are primarily the emergency loans. For, these are the fastest loans available in the market. In some cases, you can avail payday loans in a matter of a few hours. Many people with poor credit rating opt for the same as these come as the most hassle-free loans without a baggage of past credit history.

However, the convenience of ready credit comes at a very high cost. Whether you have a financial emergency or a social bearing, you should be ready to repay the loan in time. Currently, FCA has put a cap on maximum interest to be charged on payday loans. However failing to repay the loan could escalate this cost heftily.

No Credit Check

Your past credit history doesn’t make you ineligible for payday loans, provided you could establish your capacity to repay the loan. As the name suggests payday loans are meant to be repaid on your next pay date. These are basically very short cash advance loans raised for a very short period of time.

As the risk involved is for a shorter duration, there are lesser hassles and paperwork involved. The lender basically collects pre-signed cheques from the borrowers which are processed on the day you receive your next salary.

Credit check involved here is certainly a soft credit check and thus protects shrinking of your score.

Why choose payday loans for bad credit?

The convenience of borrowing payday loans makes them a hot choice for bad credit borrowers. However, with a poor rating, you should focus as much on the loan repayment as on it approval. There is no second chance beyond this point. You should carefully discuss your credit situation with the loan broker and make the best choice.

Payday loans for bad credit accounts come at a very high cost and thus rolling over these loans is just not a choice.

For example: If Jack borrows £1000 as a payday loan, he would be required to repay approximately £1100 to £1200 at the end of the month on his pay date. However, if he fails to repay this loan this month and choose to roll over, he would attract an escalated loan rate along with repayment charge. The APR % for payday loans could be as high as 800%. Thus it is important to select your payday loan carefully.

You can contact an FCA registered loan broker and make an informed decision peacefully.