Governor of the Bank of England Sir Mervyn King has claimed that short term loans could be the answer for Britain's banks. With the current Euro crisis in mind, King said that lower-cost sources may be able to help prevent further losses for the banks. King claimed that some banks thought nothing could go wrong before the crisis but, when it did, they relied on taxpayers' money to survive.
If short term loans are potentially the saviour for Britain's banks, should the same logic be applied to individuals who face their own financial crisis? In short, there are both advantages and disadvantages to taking up what are commonly known as "payday loans".
Do they have a contact page? If the lender you are considering doesn't have a contact page it is likely that they don't want to be contacted! In which case, it is difficult to put your trust in a company who won't communicate if you come across any problems with your loan.
The loan is taken up by those who need a quick cash fix - often to pay a bill or other household cost - before their next payday. The downfall to this short term loan is that repayment is usually required within a month of the transaction and the rate of interest can prove fairly steep in comparison to a regular loan from your bank or building society.
Find out the APR The APR - or Annual Percentage Rate - determines how much money you will be paying in addition to how much you are lending. The higher the APR, the more money you will have to pay back. Make sure to do your research here to find the best rate for you.
Secondly, if you find yourself in a stable full-time job then it may interest you to ask for a payday advance from your employers. If you are able to explain your position and need for a cash fix they may be able to help you out and present you with your monthly wage packet early than usual. Short term loans may be the answer for Britain's banks but whether they are equally as suitable for individuals is up for debate.
If short term loans are potentially the saviour for Britain's banks, should the same logic be applied to individuals who face their own financial crisis? In short, there are both advantages and disadvantages to taking up what are commonly known as "payday loans".
Do they have a contact page? If the lender you are considering doesn't have a contact page it is likely that they don't want to be contacted! In which case, it is difficult to put your trust in a company who won't communicate if you come across any problems with your loan.
The loan is taken up by those who need a quick cash fix - often to pay a bill or other household cost - before their next payday. The downfall to this short term loan is that repayment is usually required within a month of the transaction and the rate of interest can prove fairly steep in comparison to a regular loan from your bank or building society.
Find out the APR The APR - or Annual Percentage Rate - determines how much money you will be paying in addition to how much you are lending. The higher the APR, the more money you will have to pay back. Make sure to do your research here to find the best rate for you.
Secondly, if you find yourself in a stable full-time job then it may interest you to ask for a payday advance from your employers. If you are able to explain your position and need for a cash fix they may be able to help you out and present you with your monthly wage packet early than usual. Short term loans may be the answer for Britain's banks but whether they are equally as suitable for individuals is up for debate.
About the Author:
Matthew Wood writes, informative and education articles for reputable online agencies. His latest venture includes writing informative and engaging content for the online agency Ferratum who provide payday loan services to small and large businesses.
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