A quick loan is another name for a payday loan. These are offered by specialist lenders that tend to only deal in this sort of loan. You will therefore need to look for them in a different way to how you would normally find a loan. You will not be able to approach your bank or look in the high street windows to see what they are offering so you will need to research elsewhere. Most quick loans will be only available online and so you will need to search there to find lenders.
Do not last long
The loans themselves are short-term loans, which means that they do not last very long. They might last just a few weeks or even a few days. This makes them very different to most other more conventional loans. The idea is that you borrow money until you next get paid. Therefore, if you have only just been paid, you will not have to repay for three weeks or so but if you get it out very close to the day that you are paid then you will only have it for a few days. This is a great advantage for people who do not like owing money, as the loan will be repaid really quickly.
The loans are also available to most people, even if they have a poor credit rating. Many lenders will do a thorough credit check and judge you on whether they think you are capable of repaying the loan. Then they will only lend money to those they feel they can trust. They will look for things like whether you have been able to repay loans in the past, what outstanding debt you have. If you make regular payments and if you have a regular income. It means that if you fall down in just one of these areas, it could mean that are turned down. It is tricky though, as different lenders have different rules, so you may not know until you have actually applied as to whether they are likely to turn you down. If they do turn you down, this will show on your credit record and will be something that could go against you when you try to apply for a further loan. With a quick loan, your credit record is not used as a means to judge whether you will be accepted and so the money is available to a lot more people.
Borrow small amounts
However, because the lenders have to trust that you will repay it regardless of what you have done in the past. This means that they will not be willing to lend you such large sums of money. Most quick loans are for £100 – £1,000 and you may find that if you are a first time borrower the lender may not even lend you this much. They may want you to prove that you are able to repay a small amount of money before they lend you more.
Repay in one instalment
The lenders will also normally want the repayment in one instalment. This means that you have to find enough money to repay the whole of the loan and the interest all in one go. This can be tricky because it means that you will have to find a significant chunk of money. To help with this you will have a direct debit set up to repay the loan on the day that you are paid. You should therefore have enough money in the account because your salary has gone in. However, you need to check, because your salary may not be enough to cover it or you may have other payments going out of the account on that day as well.
Quick to arrange
The loans are really quick to arrange as well. Quick loans were set up because it was recognised that people with poor credit ratings had no financial help in emergencies. Therefore, the lenders knew that they would need to get the money to borrowers really quickly. It can therefore be possible to get the money within a few hours. This is significantly faster than traditional lenders who can take weeks or longer sometimes to arrange a loan and by then it might be too late.
So, you can see that this type of loan is quite different to some others and this means that you may feel like you are not that familiar with it. Do not let that put you off though as it could be the perfect loan for your needs so you want to use one if this is the case. If you learn more about them now, then you will be able to know whether it is the right choice for you if you are in the situation where you need to borrow money.