You may have a dire need to secure an emergency short term loan in a hurry, you may not want to go with that high profile lender for your financial needs.
If you’re under the gun when it comes to finding the funds you need to pay for a sudden expenditure, like replacing your boiler or repairing your car, it’s natural to feel a strong sense of urgency pushing you to secure a lender as soon as possible. The urgent need to get these funds may lead you to consider the most widely-known and high-profile of payday loan providers in order to save time in your search, but you should be aware that selecting one of the largest firms may not necessarily lead you to the best terms when it come to repay the loan.
WELL ISN’T THAT OF INTEREST?
It goes without saying that you won’t be getting access to these emergency funds for free. Indeed, lenders make their money by charging interest on the funds they agree to loan to borrowers, and whether it’s a high street bank or it’s a purveyor of payday loans online, the common thread is that you’ll have to repay the loan in full and then some after the terms of the loan expire.
Payday loan providers universally charge much more for a loan than a traditional lender, and it’s not uncommon to see 1,000 per cent annualised percentage rates listed on the websites of these lenders. However, the larger and more high-profile lenders often charge the highest out of all their competitors to the point where industry leader charges an almost inconceivable 4,214 per cent on its short term loans!
DOESN’T MAKE MUCH SENSE, DOES IT?
It seems completely counter-intuitive to have the market leader in the provision of short term loans charge the highest interest rates you can find. However, they can get away with this exactly because they have become so well-known; the lender is oftentimes the first (and only) stop prospective borrowers make when they go on a search for a lender to meet their needs, never discovering that there are competitors out there that are willing to provide capital to them for much less cost in the end.
This is precisely why would-be borrowers need to keep their heads about them and do at least some perfunctory research before applying for a payday loan, even though they feel the urgency of whatever it is they need to pay for in order to get their affairs in order. Simply choosing the first or most high profile loan that comes along can turn out to be the worst kind of false economy if the terms of the lending are so severe that it’s impossible to repay in a timely manner, leading to late fees and compounding interest that can cripple the unwary borrower, so do yourself a favour and ensure you’re making a responsible decision when it comes to choosing a lender that fits your needs.