Ingenious 24

Payday loans are one of the easiest types of loans to get.  Classed as an unsecured loan because they are not secured against an asset, payday loans generally have a very small list of requirements for applicants.  This may include proof of identification, proof of being at least 18 years old, a minimum income and some form of employment.  Applying is very easy and can be done in minutes online – the decision is usually made instantly.  Money is then transferred the same day in most cases.  So why isn’t everyone rushing out to get a payday loan?

The reason is quite simple: while they are easy to obtain and no credit checks will be carried out, they do still need to be repaid – and within a fairly short space of time.  Most payday loans have a timeframe of around 2 weeks to a month.  On top of this, the APR rate can be exceedingly high – in some cases well over 1400%.  This means you can be paying back far more than you borrowed in the first place and face hefty penalties if you do not pay back in time.  There are some payday loans which have more flexible terms – therefore these are probably the best to look out for.  It is worth bearing in mind that while a credit score needn’t be great in order to get a payday loan, it could suffer greatly as a result of taking a payday loan and not paying it back in good time.

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