Using Direct Lenders

There can always be times when some person needs money and this can be down to so many different reasons. There can be some people who could perhaps need a large amount of money as they are looking to make some form of expensive purchase for items that could include a new car or maybe someone could even be looking to put down a deposit on a new house, There can also be other people who just need a small amount of money as they could have just suddenly had an unexpected bill arrive and they need some money to put towards that repayment. Someone else could also just need a small amount of funds to tide their wages over until the next time they are paid so they again only need a small loan amount.

If people have the money saved they can use this for what is required, people can sometimes pay for their requirement outright or at least they can pay some money towards what they need. People will of course in some cases be able to save more than others and a whole host of things can often affect what people will be able to save on a monthly and then a yearly basis. People if they have a large amount saved can pay in full for what they need some people even if they are looking to put down a deposit on a new house they have the required amount and therefore don’t need to borrow money at all. Some people in contrast will have some saved but it is not enough to pay for what it is required for outright. At least in these scenarios people can pay some money towards what they need. If no money is saved then obviously more will need to be borrowed.

Now when it comes to borrowing money I think it is fair to say that most people especially first of all will try to get the money from their friends or family. They know if they borrow this way they can get the money interest free meaning people here only pay back what they originally borrowed in the first place. People from friends and family acting as direct lenders can get the money quickly and then they can just repay back what they borrowed as soon as they have the required funds available to make that repayment. People borrowing cash this way are actually under no legal obligation to repay the debt however this does not mean they should not honour their financial commitments. If borrowing money way is not available then direct lenders can be approached in the way of a loan or another type of finance grant. Here people can then possibly where applicable borrow a range of different loan amounts and other finance types to then repay the debt over a range of different repayment term. Any money taken this way people, must know interest will be charged on any amount borrowed.

Resources for Making it to Pay Day

As consumers there can be times in the month when we find ourselves short of money, whether this is as a result of an unplanned cost or simply poor planning, when a lack of money is apparent, often action is required. Consumers in general now live in a world where a whole host of resources are at our finger tips, whether this is shopping, socialising or general management of everyday tasks, the internet provides the resources to enable us to this easily. Although this means in a number of ways we have been able to modernise our everyday lives, this never ending resource also means that we need to act responsibly so as to not over commit ourselves financially. Whilst many of us have become accustom to making monthly repayments in order to manage our lives and chosen purchases, in times when we face an additional bill or expense, we may struggle to fund the requirement in question. Today we will be looking at a range of resource to try and either avoid or better manage monthly expenses.

First and foremost money management is important to make sure you make it successfully to your next pay day without the requirement to consider a loan or other form of borrowing resource. Money management is as simple as being aware of what you are committed to each month and ensuring the repayments are met on time. One of the best ways to manage your money effectively up to the point of your pay day is via a monthly budget plan. A budget is easy to complete and refer to and only requires you to be accurate in order to be useful. To complete a budget you must list all of your monthly outgoings separately and then ensure your monthly income covers these costs. This means accounting for the costs associated with the household as well as any other monthly regular costs. The completion of a budget can often highlight where savings can be made in the approach to your pay day, as well as enabling you to manage your income throughout the month.

Other resources which are available to consumers who are looking to account for the costs due up until pay day are borrowing based. In the modern economy there is a whole host of different loans which may be able to suit the needs of the individual applying. One such example are online pay day loans which allow a small amount of money to be borrowed over an agreed period of repayment. These specific type of loans often allow borrowing from £100.00 to £500.00 and can be repaid over a good selection of terms. Depending on the selected resource this could be for example, three months or repayment or perhaps 9 months. Often the repayment term and amount made available to borrow will be based on your own circumstances and what is realistic and affordable. So with this in mind it is important to be honest and accurate should you apply for such a loan to see you to your pay day. 

Direct Lenders can Offer a Range of Different Finances

There can always be occasions when someone needs money and to be fair this can be down to so many different reasons. There can be some people who need a potentially large amount of money, this can be because they need to make a large one off expensive purchase of some kind. This can be for a possible new car or maybe someone could even look to be putting down a deposit for a new house. On the other hand there can also be people who just need a small amount of cash to possibly help tide their finances over until their next time they are paid. Some people could also need a small amount of cash borrowed as they had an unexpected bill arrive of some kind. Now no matter what the reasons are for ever needing money if people have this money saved they can use it as required for what they need, some people could possibly pay for their requirement outright or at least people can pay money towards what they need. If that is not a valid option for someone then the chances are people will have to borrow what they need.

When it comes to borrowing money some people or may not know that there are a number of different borrowing options available for people to apply for and then where applicable take out. That is just one of the many reasons why no one should ever just rush into applying for the first piece of finance that comes along their way. People can apply for short term loans where they can borrow small amounts from direct lenders and then they can repay the debt back over a short time frame. Instalment loans are a common borrowing alternative and here people can often borrow larger loan amounts from direct lenders and then repay those lenders back over a much longer period of time. These are the most common loan available. Credit cards are also a very common way to borrow money when people need to, they allow people on credit to pay for items or withdraw cash via the use of the card.

Direct lenders often offer finance with a range of flexibility so people can decide what they want to borrow and then repay the loan over a time frame that is both affordable for someone and one that basically just suits there current financial situation. This is not the case for payday loans borrowing. These loans are often funded to people who have poor credit, people can often take these loans and then repay the debt the next time they are paid and no other financial repayment terms can be available. People here as well can only usually borrow amounts from £100.00 up to £1000.00. Payday loans from direct lenders are also usually an expensive way to borrow money. With instalment loans as the alternative, people can often borrow larger amounts of different values and then repay the debt over a much larger range of repayment terms. That makes the instalment loan typically a large more flexible type of finance than the basic short term payday loan.

WHAT IS AN INSTALLMENT LOAN?

An installment loan is a loan borrowed for an agreed set amount that is repaid over several months in installments until the full balance is settled. Many customers will take out or consider making a loan application at some stage in their life, there are many benefits and a few negative factors when looking into this but first people need to be made aware of what an installment loan technically is and what customers are originally signing up for.

An installment loan is a set amount borrowed by a customer and is then repaid over an agreed set period of time, each loan agreement will vary between different repayment amounts and how long customers have this loan for but some instalment loans can be borrowed for up to several years and sometimes for even a longer duration. For example a mortgage is a type of installment loan. When a consumer takes out this type of finance loan their repayments that will be owed will be for a set amount agreed between the lender and borrower, for example if a customer borrows £1,000 it is most likely a loan for that amount would be repaid over a 12 month maximum period but this could vary in some cases, the repayments on this would most likely be up to about £150.00 and I imagine that about nine amounts would be due which would make the total amount paid back at around £1,350. This is quite a high interest loan and most lenders would charge much less interest than this. Before choosing the instalment loan is it always worth exploring the different options available at that time so a customer can find a loan with a good interest rate and one that offers a repayment schedule that is over a fair amount of months or years and more importantly it can be affordable.

When we consider where installment loans typically exist from we tend to think of banks offering consumers a long term lending solution. Often such loans are associated with long repayment periods, often years, and generally speaking for large amounts of money. This in itself is sensible and logical but what about the short term lending market? There are various companies that can offer short term ways of lending but instead of one month short term loans they will offer installment loans, so customers can now then borrow up to £1,000 and repay at a time that suits them more but normally no longer than 12 months would be considered for this type of financial product.

The market for borrowing a small amount of money for a short period of time is now changing and the options which exist within it are growing. For many years if a consumer needed to borrow an amount of cash, typically smaller than an amount available from a bank or other so called high street lender, the options available were limited and very specific. That’s not to say there wasn’t choice, there was in terms of lenders available but the product on offer was a short term loan that had to be repaid over a single month. A consumer would be able to choose from a range of lenders but all presented the same option, borrow an amount until your next pay date and pay the full amount back. If as a consumer you are considering changing the repayment term then contact the lender and advise what you want to repay but also if possible make additional repayments or make early repayments to get the account cleared and paid off much quicker. The customers would not be penalised for this and they may find with earlier repayments the amounts due are less as some of the charges and interest may be able to get removed that could have previously been added.

That’s not to say that this didn’t suit some consumers who just needed a quick money fix but for a lot it has become clear over the years that short term lending habits are more complex than this. As time goes on it is becoming more increasingly clear that consumers now view the short term lending market as part of their monthly income and budget requirement to ensure repayment to a range of life expenses from bills to cars and more can be made and not be missed. That’s why it’s so important that the market is expanding and an increase in lenders offering instalment loans instead of shorter term loans is increasing with it. It is always vital that if an instalment loan is taken out that the repayments due are affordable and are met on time as failing to make repayments on any loans can have severe negative consequences.

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SHORT TERM LOANS

In the past the short term loans market has received a lot of criticism for the way in which it operated and the treatment its customers received. As the sector grew the attention it received from the media and governing bodies alike made it evident lenders were pushing the limits in terms of its practices and equally providing minimum effort to ensure customer service was a major consideration of its overall operation. This realisation has certainly helped pave the way for a more consumer friendly product but also ensured the lenders which remain are able to be successful due to their continued commitments to getting it right. To understand the improvements it is fast best to look back at how far the market has come.

When short term loans first became available they offered something consumers had not had access to before. Whereas in the past a consumer would need to discuss loans of any size with their bank or a shop floor establishment, these loans were available pretty much at a click of a button. In order to be approved typically the customer would complete a relatively short application form online and receive a quick decision from the lender. The product too was simple to understand and offered a clear repayment structure. The old style short term loans asked for a lump sum repayment to be made on the due date of the loan. An applicant could request an amount from £100.00 up to £500.00 typically and when the agreed repayment date arrived this amount plus interest was to be repaid. Often these early loans would apply interest specific to the amount borrowed rather than the time taken which proved expensive. This meant whether a loan was for 15 days or 30 the amount was the same. This way of working was often based on the fact the whole product was designed around the concept of repaying on the customer employment pay date; not therefore considering the time the loan has been in operation. A costly feature for those applying close to their individual pay date.

The whole principle of a lump sum repayment although suitable for some, for most, proved simply unaffordable and meant many consumers borrowed from one lender to satisfy another, creating a cycle of debt. This expense was further compounded by lenders when an alternative repayment option was introduced, these were known as extensions. An extension meant the customer could simply repay the interest applicable on the loan when their due date arrived and then delay the lump sum repayment until their subsequent pay date. Although again a singular extension may not have been costly, many consumers found themselves continuing to extend over a large time frame and ending up stuck when the lump sum repayment was still unaffordable. Another costly feature for the user of such loans.

To seal the deal these lenders were also known to be unhelpful and showed no sympathy to those customers who were in genuine financial hardship and who had tried through extensions and reduced offers, to keep their heads above water. It is therefore no surprise that changes were enforced and those lenders of short term loans who were unwilling to adapt are no longer in existence.

Now things are different, instead of lump sum repayment loans the market is offering a more flexible and consumer friendly loans which are better checked for affordability of repayment. Instead of asking a customer to make one large repayment, an instalment loans lender will offer a range of repayment terms, typically from 3 months up to 12 months. This allows the applicant to make a selective decision as to how best to repay the loan. There are also new practices being brought in by lenders to ensure they are lending responsibly. These checks are mainly focused around assessing affordability. Often an instalment loans application will now ask the customer to supply all information relating to their monthly expenditure which allows the lender to decide clearly if the applicant has the means to make the repayments as set out in the loan agreement. This combined with better analysis of the customer credit worthiness and previous repayment history helps to ensure a true picture of the customers current financial circumstances. It would therefore be fair to say that the short term loans market is gaining back some of the positives it was originally recognised as having, which in time, will hopefully ensure the market is able to remain a useful one for the consumers who turn to it.