Quick loans are a useful finance solution that you can both apply for and be accepted for in a very short space of time.
Is a burst pipe flooding your home as you’re reading this? Do you need to buy parts right now to get your car back out of the repairs garage fast? Quick loans take just five minutes to apply with decisions given to you within just seconds.
If you’re accepted, you’ll only have to wait a maximum of two hours for the money to appear in your bank account giving you the funds you need as soon as possible.
Where can you get a quick loan from?
Many of the top lenders in the UK offer their own version of the quick loan. You may have heard of these as ‘instant payday loans’ or ‘short-term emergency loans’. They are designed to help you if you’re in need of money fast.
Here’s what you need to know…
A short-term loan is normally for an amount between £100 and £1000 and you have between two and twelve months to pay your loan and the interest back. The longer you take out a loan for, the smaller your monthly repayments will be however you will have to pay back more interest if you borrow over a longer period of time.
You don’t need to offer any security for a short-term loan meaning that your home, your car, and your valuables will not be taken away from you if you fail to repay the loan in full. You also don’t have to find anyone who will pay back your loan on your behalf if you can’t.
There are specialist short-term lenders who work with people whose credit score is not perfect – they’re more interested in finding out who you are now rather than worrying about something that might have happened to you a few years ago.
Short-term bad credit loans tend to have higher interest rates than a loan you might take out from a bank, building a society, or other financial institution.
You can apply for a short-term loan and have the money paid into your bank account within minutes depending on how long it takes you to sign the online paperwork and on whether your bank account allows for “faster payments”.
A payday loan is a very short-term loan where you pay back the money you owe plus the interest on the loan back in one instalment, usually within 30 days of the date you receive the money from your account. Just like short-term loans, you don’t have to offer your payday lender any security which they’ll take ownership of if you don’t pay back the loan.
Payday loans are taken out by millions of Brits every year – they’re a very popular solution if you need money in a hurry for an emergency.
Interest rates on payday loans tend to be much higher than other forms of credit however they are capped to a maximum of 80p per day for every £100 borrowed by the Financial Conduct Authority.
You can apply online for a payday loan and, depending on how quickly you sign the online documents and on whether your bank account is registered with the “Faster Payment” system, you could receive the money within minutes or hours of applying.
If you have an overdraft with your bank but an emergency bill means there’s not enough available cash in your bank account to make the payment you need to make, you can ask your bank to extend your overdraft. Some banks will allow you to make the request online but others will require you to go into a branch to make your application.
Sometimes, even though a bank will know that allowing a payment will push you past your overdraft limit, they will let you pay someone and this means that you’ll go into an unauthorised overdraft. Unauthorised overdrafts cost a lot more than authorised overdrafts, so much so that the Financial Conduct Authority has launched an investigation into whether unauthorised overdrafts are fair to consumers.
If you have a credit card but there’s not enough cash left on it to make an emergency repayment, you can always call up your credit card company or visit their online website to ask if they will extend your limit.
It’s entirely up to your credit card provider whether they will allow it and, if they do, they will normally give you your extension straight away.
If you only make the minimum repayment every month on your credit card account, please be wary about applying for an increase in your limit. Making only the minimum repayment means that it can take a year (sometimes decades) to clear your credit card balance and you’ll pay a lot in interest over that time.
If you currently bank with a credit union and you have built up savings with them over the last few months, you’ll able to apply for a quick loan from your credit union’s funds.
Some credit unions allow you to apply online although others will need you to come into their branch to ask for a loan. If it’s the latter, please bear in mind that most credit unions are only open for a few hours every week so you’ll have to make sure that you get an appointment as soon as possible. If you need money now, your credit union might not be able to act as quickly as you need them to.
You can borrow a similar small amount from a credit union similar to the size of a loan you’d take out through a payday loan or a short-term loan company. The interest rate you pay on your loan will often be cheaper than the interest rate you’d pay to a payday loan or short-term loan provider.
Loans from credit unions are unsecured meaning you won’t have to surrender your valuables, your car, or your home if you can’t make the repayments when they’re due.
Pawnbrokers offer secured loans against household valuables, white goods, electronic equipment, jewellery, and more. If you take in an item worth £100 and your pawnbroker agrees to take it as the security on your loan, you’ll probably receive around £60 for your item.
Now you have your money, your pawnbroker will tell you the dates on which you need to make your repayments and for how much on each date. If you can’t pay back your loan, the pawnbroker will keep whatever you’ve paid them so far and they’ll also take legal ownership of your security.
Your pawnbroker will then try to sell your valuable in his or her shop for a much higher price than the amount of money they advanced to you when you took out the loan.
Guarantor loans are loans where someone else vouches to pay back any outstanding amount of a loan which you can’t make, for whatever reason. If you borrow £10,000 and you default on your loan halfway through, your guarantor has to pay back the remainder of the loan on your behalf.
It can be very difficult to find a guarantor because, as you’d expect, people get nervous about promising to pay back another person’s loan. Your guarantor also needs to have a very good credit rating before a guarantor loan company will say “yes” to your loan.
If you don’t keep up repayments and your guarantor has to pay the balance on your behalf, this may put a lot of strain on your relationship with them so please be careful before taking out a guarantor loan.
Please also be aware that the guarantor loan sector is under investigation by the Financial Conduct Authority over allegations of excessive interest rates and high default and communication fees.
A logbook loan uses your car as security – you can borrow up to 75% of its value and your loan can be paid into your bank account normally within an hour.
Once you have signed the online documentation and you’ve received your funding, the logbook loan now legally owns your car. You only take back ownership once the loan is fully paid off.
As with bank overdrafts and guarantor loans, the logbook loan sector is under investigation by the Financial Conduct Authority because of fees charged and disappointing standards of customer support if someone falls behind on their repayments.
Quick loans – frequently asked questions
If you are considering a quick loan, you’ll want to find out everything you can before you commit to anything. That’s why Loan Princess have compiled some of our customers’ most frequently asked questions to help you feel more comfortable about your decision to apply for a payday loan or a short-term loan.
What do I need to do once I’ve been accepted?
The main convenience of a quick loan is that you will get your loan decision within just seconds of submitting your application online. These same day loans are extremely quick and easy to apply for and you will know whether your submission was successful almost instantly.
If accepted, you simply wait for the funds to appear in your account to cover the cost of your emergency.
How quickly will the money reach my bank account?
Quick loans can take varying amounts of time to go through depending on the lender you choose. However, the majority of quick loan providers will only ever make you wait a maximum of two hours following your loan approval for the funds to appear in your bank.
This makes quick loans ideal for situations where you need money right away.
Should I use a broker or should I approach a lender direct?
You can find out how much a lender is offering and how quickly your application will be processed directly on their respective websites. Searching through these to find the best deal can take a great deal of time and effort – completely voiding the point of taking out a quick loan.
If you are in need of money fast but you want to make sure you get the best possible loan terms, interest rates, and repayment plan using an online broker service is the only way to go. You can compare quick loans from many of the UK’s top loan providers and find the provider that best suits you in just seconds.
Loan Princess is a broker so we’ll do all the work for you – and we don’t charge you a penny.
What do people use short-term loans and payday loans for?
Short-term and payday loans can be useful for a wide range of scenarios. Quick loans, in particular, can be a life-saver when an unexpected emergency arises that you can’t afford.
Let’s say that your car broke down tomorrow and your mechanic needed you to buy a particular part to get you back on the road. Without it, would you be able to get to work? How would you take the kids to school? Or what would happen if a pipe burst in your kitchen and you’d forgotten to renew your home insurance? You couldn’t sit by and watch your home flood.
Payday and short-term loans that provide the money you need in a matter of hours or even minutes mean you can resolve the situation you’re facing quickly and efficiently if you don’t have enough in your current account or savings account to make the necessary payment.
Will I be credit-checked?
When you apply direct for a loan, each lender will need to complete thorough research into your credit file and borrowing behaviour before they’ll approve you.
While this can be done reasonably quickly, if you are applying to multiple lenders at one time, all of these applications will appear on your credit file. Lenders don’t like it when borrowers make multiple applications meaning that it can actually make it less likely if you shop around by yourself.
Brokers like Loan Princess on the other hand only do one search of your credit history. That means our lenders don’t have to mean that we can do the shopping around for you and there won’t be multiple searches on your report.
What if I have poor credit?
All lenders are required by law to check your credit history before they are able to lend to you, however, many loan providers specialise in finance for those with poor credit.
Even if your credit score is not the best, the chances are that there will always be at least one specialised quick loan provider willing to offer you credit. The trick is knowing where to find them.
When you submit your application through our online broker service, we take all of your details to match you up with the lenders we believe are most likely to accept you. That means you can improve your chances of being accepted for a loan and greatly cut down the time it takes to compare deals yourself.
Are the interest rates high?
In the financial industry, payday loans and short-term loans belong to a part of the finance sector called “High-Cost Short Term Credit” (HCSTC). HCSTC includes quick payday and quick short-term loans offered by lenders either direct or through brokers in the UK.
In 2015, the Financial Conduct Authority brought in new rules to protect lenders taking out HCSTC products.
Nowadays, interest and fees are capped at a rate of no more than 0.8% per day, default fees must be no higher than £15, and the total cost you repay for your loan will never exceed 100% of the original amount you borrowed. So, if you borrowed £200, the most you would ever be asked to pay back would be £400.
All lenders will have their own interest rates and rules around fees so, by shopping around using a broker with dozens of a lender on their panel, you should find a deal that’s right for you.
Can I cancel my loan?
Other rules around short-term credit also aim to protect you as a borrower. When you take out a personal loan, you have a fourteen day cooling off period from either the date your agreement is signed or when you receive your copy of the agreement.
If you should change your mind about your loan in this time, you will have up to thirty days to repay the money you received plus any interest and charges you accrued in that time.
You won’t need to pay all of the fees for the original loan term – just enough to cover the time in which you had the loan money in your possession.
Apply for a quick loan through Loan Princess
If you need a quick loan to cover a financial emergency, you will want to ensure you get the best terms possible for you.
By comparing the UK’s top quick loan providers through Loan Princess, you can find the lenders most likely to accept your application offering the most attractive rates and terms.
All you need to do is fill in our simple online form and your application will be sent out to our panel of expert instant loan providers. Let us know how much you’re looking to borrow, how long you would like to borrow it for, and how you intend to pay it back – then leave the rest to us.
Thanks to our close relationship with all our lending partners, we know exactly what they’re looking for in a borrower. This allows the Loan Princess team to match you up with the lenders we believe will be most interested in lending to you.
All this happens within seconds so get in touch with us today.