If you find that your savings are limited and you’re still a week or two away from payday, what can you do when faced with an unexpected expense or financial emergency?
When there are no clear ways to resolve your situation it can be stressful, which is why same day payday loans can provide the help you’re looking for.
Whether you’re familiar with them or have never needed to use them before, there are a few key things to consider before applying for a same day loan. What can you afford to pay for repayments each month? How much do you need to fully cover the expense? How long do you want to repay? Questions like these need to be thought about along with a few other important elements to ensure you can make an informed decision.
Are Same Day Loans A Good Option?
Same day loans are designed to provide quick access to cash when you need it most, so they can be ideal if you’re facing a financial emergency. They usually have short online applications that can be completed in minutes and applied 24/7, making them very convenient when using your smartphone or tablet in an emergency.
Whether they are a good option for you will come down to a few things – they typically will be for smaller loan amounts than, say, a personal loan, usually under £1,500, and the repayment terms will be shorter too, for example, under six months. If your unexpected expense is small and you can afford to repay a same day loan over a few months then they can work. Also, if you have a less-than-perfect credit history, many same-day lenders can still look to help as long as the loan is sustainable, so this can mean more people are eligible.
How Do Same Day Loans Work?
The process of obtaining a same day loan is designed to be quick and straightforward. Typically, you’ll need to fill out an online application form, including personal and financial details, which should only take a few minutes. Lenders may require proof of income, employment status, bank account information, and photo ID. Once the application is submitted, the lender will assess your eligibility and creditworthiness. This is all done in minutes, so you do not have to wait long for a decision.
Upon approval, the loan amount will be sent directly into your bank account on the same day if it is within the lender’s business hours. If your application is done outside of these hours, such as late at night, it will be processed the following working day as soon as possible, so you’ll need to consider this if you need funds quickly.
When repaying the loan, a lender will usually arrange this through a Continuous Payment Authority (CPA). This is an automatic payment set up on your bank account, so all you will need to do is ensure funds are available at least the day before repayment is due. This makes maintaining your repayments easy. Once the loan is fully repaid, the CPA will automatically stop.
Things to Consider Before Applying For a Same Day Loan
If a same day loan sounds ideal for your emergency needs so far, here are a few things to consider before starting your application:
- Repayment ability—Evaluate whether you’ll be able to repay the loan on time based on the repayments available. A shorter repayment term is the better option, but only if you can afford to make higher repayments each month.
- Alternatives—Before applying, Explore other options, such as asking friends or family for help, using emergency savings, or seeing if you can delay the unexpected expense until you are next paid by speaking to the company the bill is with.
- Impact on credit – Defaulting on a same day loan can negatively impact your credit score, potentially affecting whether you can borrow again. Only proceed if the loan is sustainable for you and will not be difficult to maintain.
- Fees and charges – Familiarise yourself with the charges associated with the loan to avoid any surprises during repayment. If using a reputable lender, there should be no hidden fees, and you will have full transparency of the loan terms before continuing.
A same-day loan can be undeniably helpful, but rather than rush to apply, carefully consider the benefits, risks, and responsibilities of taking one on. Be sure to check that the lender is fully authorized by the Financial Conduct Authority (FCA) and that you are happy with the interest charge on top of the loan amount.
If used only when you have no other way to resolve your situation, same day loans can provide the same day financial help you’re looking for.
Author Bio:
Kelly Richards is the founder of the Cashfloat blog and has been working tirelessly to produce interesting and informative articles for UK consumers since the blog’s creation. Kelly’s passion is travelling. She loves her job because she can do it from anywhere in the world! Whether inspiration hits her while sitting on the balcony of a French B&B, or whether she is struck with an idea in a roadside cafe in Moscow, she will always make sure that the idea comes to fruition. Kelly’s insights come from her knowledge gained while completing her degree in Economics and Finance as well as from the people she meets around the world. Her motto is: Everyone you meet has something valuable to teach you, so meet as many people as you can!
