Have you ever had to cover a major medical bill, utility expenses, debt repayment, or another emergency? If yes, then you must realise that it is not easy for many people to come up with so much cash right away. Most financially savvy people form a habit of creating a neat little emergency nest. But it is not sound to dip into those savings for every little expense when you have plenty of other options to help you pull through your emergency. Luckily, you can apply for a payday loan to help cover your immediate expenses. If you do not have enough cash, an emergency payday loan is definitely the way to go in sickness and debt. However, before getting an emergency loan, you must understand how it works.
What is a Payday Emergency Loan?
Payday loans are among the most popular forms of emergency loans. An emergency loan allows you to gain an unsecured personal loan that you can spend to cover unexpected expenses. There is no fixed amount you can borrow to cover your costs, but emergency loans are relatively small. Usually, you can borrow anywhere from 300£ to 1,000£ for three to twelve months. The lender usually decides the amount and return time limit. However, their interest rate in the UK is fixed.
Emergency loans are very quick to process, unlike other more conventional loans. Their quick availability is the whole reason for their popularity among the people. Immediate approval, fast application processing, and the sudden availability of funds can quickly solve many problems. Some of the more efficient lenders can even make your loan available to you on the same day you apply for it. That’s how fast this system works.
Since emergency loans are usually unsecured, you need not put up any personal asset as collateral. However, some lenders offer larger secured personal loans that may require the borrower to put up some collateral. These loans are meant to handle more significant expenses, like home equity or savings account funds etc.
You can get yourself some quick cash via emergency loans in the form of payday loans, credit card advances, personal loans, etc. Since these loans vary lender-to-lender, it’s up to you to evaluate each option very carefully. Consider certain important factors before committing, like maximum or minimum borrowing limits, interest rate, fees, credit score and income requirements.
Popular uses of Emergency Payday Loan
Emergency payday loans can help you in sickness and debt. No matter the situation, you can always find some funds to take care of sudden expenses. Like;
- Medical Expenses: Quality medicine is one of the most expensive things to acquire for common people, especially without proper NHS support. You can encounter unexpected medical expenses anytime, anywhere. The quick availability of cash easily resolves such an issue through a payday loan. You may not have to wait until your salary comes in to acquire the medical service from your doctor. Get the cash now and get the procedure done. You can pay it back once you get your regular salary.
- Rent or Mortgage Payments: You can pay off any upcoming mortgage or rent expenses with your emergency loan. The loan may not pay the whole expense, but it can definitely help you cover the difference. Borrow the amount that tides you over until you can pay it back on your next salary day.
- Utility Bills: Keep the gas, lights, internet on by paying utility bills on time. If you do not have the necessary cash, use an emergency payday loan to tide you over. Paying your utility bills on time will also help improve your credit score.
- Funeral Expenses: It is difficult when a loved one passes away, especially in an unexpected way. It may fall unto you to pay for the funeral costs. If you lack the cash, just take out an emergency payday loan and continue with your formalities. Pay it back once the service is over.
- Emergency Auto or Home Repair Expenses: Everyone knows that emergency payday loans have a high-interest rate. But their instant availability more than makes up for it. A faucet in your home may break, or a wheel axel may come off of your car when your payday is still a few days away. In such a situation, a payday loan will be of immense help. You do not have to sit in wait for your salary and spend your days in misery. Instead, have immediate repairs and continue to enjoy your life.
- Debt Repayment: When a due date for a substantial loan is coming up, you may find yourself short a few pounds. Waiting for your payday may seem like a reasonable solution. But, unfortunately, late or partial payment of such loans can severely damage your credit score. It may even garner a permanent negative mark in your financial records. That’s why it is better to just get an emergency payday loan for a short amount of time and pay the difference.
4 Popular Types of Emergency Loans
Emergency loans come in several different forms, but these are the four most popular;
1. Personal Loan
A personal loan can help you consolidate your debt or pay for a major purchase. You’ll need to provide the lender with proof of income and other financial information. In addition, the lender may hold some personal assets as collateral against the loan, like a car, real estate, investments, etc.
2. Payday Loan
Payday loans are meant for a short-term loan that is a low amount but costs a high interest rate. Typically, payday loans do not require collateral nor a credit check. They have a fast turnaround. You must pay them back by your next payday. You may borrow anywhere from 300£ to 1,000£. Payday loans have a high interest rate, but they also make funds available to the borrower the fastest.
3. Title Loan
You can get a loan when you hand over the title of a vehicle to the lender. The lender loans you money in exchange for that collateral. If you do not repay the amount, the lender may legally keep your vehicle.
4. Credit Card Advance
If you own a credit card, you can borrow additional cash through the available credit balance. The interest rates for borrowing through a credit card are certainly higher than making regular purchases. Moreover, you can expect to pay additional fees on top of the hiked up interest. Interest starts to accrue as soon as you take the money out. Unlike other loans, there is no grace period. This strategy allows you instant cash, but it should be considered a last resort option.
Where to Get an Emergency Payday Loan?
If you wish to borrow some emergency cash, you have plenty of options available to you. You may borrow through a credit card or a bank. However, I recommend employing the services of a payday loan lender.
Nowadays, better payday lenders have digitised their services. Go to a reputed website and make your choice. There are many kinds of emergency loans available. The best thing is, most of these loans do not require you to be a member or a current account holder. Many loans have a list of qualification specifications attached to them. You can simply view these specifications and find out if you qualify for a specific loan before applying for it. Such foresight can help you avoid much of the negative impact on your credit record.
Just like many banks offer online transactions and processing options, payday lenders also offer their services online. Additionally, they operate under strict regulations. That’s why you can engage their digital services without worries.
Please keep in mind that lenders have their own standards or requirements for eligibility or repayment. That’s why you should review your application thoroughly before applying. Do not operate under the assumption that all lenders have the same conditions and limits.