Direct Payday Loan Lenders are the Best Option


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The realm of short term financing has a wide range of different options for you to choose from. Since the recession during 2008, personal loans have seen a constant increase in usage as people become more desperate for an immediate financial solution. While taking out a short-term loan of any kind can reap certain benefits, there can be a number of disadvantages also. There are a multitude of variations for you to choose from each with its pro's and con's. The availability of financial products in the market makes it even more attractive to the average person, but some have far too much complicated jargon that makes it difficult to understand.  

You’re probably reading this with a whole lot of skepticism. Direct payday loan lenders are known to have a notorious reputation of trapping people into an insurmountable amount of debt with their high interest rates and late fee penalties. However, much of this speculation is actually far from the truth, especially after a recent influx of new rules from the regulator, the Financial Conduct Authority (FCA). It’s without a doubt that payday loans are often marketed towards people with poor credit scores, but that doesn’t necessarily mean that these individuals are incapable of managing their debts. Equally in no way do direct payday loan lenders intending to exploit uninformed borrowers who aren’t familiar with financial terms. Many of the payday loan borrowes have, or know they would have, had their applications rejected from banks and credit card companies for one sole reason: poor credit scores. Credit score are vitally important to all types of lending and payday loans are no exception. You will not get a payday loan 'regardless of your score', it simply will apply less emphasis on some things and more on others compared with the banks view. It may also be that having had NO credit before that there is nothing to judge what you will do when you have some and that can frighten main stream lenders into not lending.

Payday loans understand that concept and instead of dismissing people who have never even had the chance to borrow money, direct payday loan lenders are the ones who place their emphasis in their ability to make the promised repayments. Granted that direct payday loans are unsecured and don’t require borrowers to pledge collateral, payday loan lenders end up incurring a whole lot of risk. In order to balance out the risk to make it worth taking, direct payday loan lenders are left with no other choice but to make use of high interest rates. Payday loans provide so much value to those in need during financial emergencies, and yet they end up being misunderstood after publications of sob stories from people who failed to properly manage their debt.

The fact of the matter is that direct payday loan lenders approve borrowers based on requirements that aren’t as stringent as banks, but that doesn’t necessarily mean that these requirements don’t exist at all. Payday loans require the borrower to have a stable income. The amount of income determines the maximum loan that can be taken out by the individual in question. This procedure is to ensure that the individual doesn’t borrow a loan that he or she is unable to afford. In a sense, it’s a safety precaution not for the lender, but for the borrower. If direct payday loan lenders were as vicious as people make them out to be, they wouldn’t even bother setting that barrier to begin with. Literally anyone could approach them and take out a payday loan of £10,000 and trap himself or herself in debt, which would assure the lenders that they’ll be receiving a steady amount of repayments from late penalties and accumulative interest. As beneficial to the business as that may sound, payday loan lenders are run by actual humans who have feelings. They aren’t the devilish monsters that people make them out to be.

Direct payday loan lenders actually prefer honest individuals who stick to their promise of making repayments on time. The interest that’s attached to the loan is nothing more than the fee that you have to pay for the fast processes, availability, ease of acceptance and risk. It’s an expensive price to pay, but you have to understand that’s how moneylenders even make money. Reducing these interest rates may lead to the business not being able to afford its overheads, which would make it unsustainable. No business would want to be placed in such an unfavorable position.

Normally payday brokers don’t process your applications for you, and neither do they lend you teh money. That’s not their interest. Whatever application form you send to them is re-directed to an actual direct payday loan lender, who determine whether the application is approved or not. Once the application is approved, all costs of the loan are absorbed by the direct payday loan lender; not the broker. The broker is simply there to encourage sales for direct payday loan lenders. 


Direct lenders and why they should be used when borrowing

Before a loan is being looked into and someone is thinking of applying they have to ask themselves a few things such as do they definitely need any finance and if so what kind of financial loan are they wanting? There are so many different types such as standard car finance, a mortgage is a type of instalment loans and other long term lending or is it a short term loan that is being sought. Another important point that has to be considered would be the lender that has to be chosen and whether to use a direct lender or a financial broker and it is that final point that I will be concentrating on in this article below:

One main benefit of using a direct lender would be that it does not cost anything to submit the application directly with them as they are the direct lender and there will be simply no handling costs. If an application goes through a broker then in some cases there may be an upfront cost for the customer in order to use their financial services. A broker will then try to search for a loan for that person however it will never guarantee a loan.

If a customer has a poor credit history in the past then they may choose to use a broker for convenience. By this I mean that instead of filling in countless applications and getting them all declined, with a broker you complete just one and this is offered to multiple lenders and other brokers to see if any will accept you. However, my best advice would be to sit down and conduct your own research and find a direct lender, look at there rates and terms, if you have any questions give them a call and when you are happy, make the application. If this is not successful then repeat the process.

Another thing worthy of note, if more than a couple of lenders decine you it may be worth while asking yourself whether the solution you are using is the best solution for your situation If you need further help a couple of these charity companies can put you on management plans or just provide financial advice and they are called Step Change and Payplan.