Payday Loans

Should I Repay my Payday Loan Early?

We will often hear advice that we should repay loans early. There are advantages to doing this but it is also worth some thought because it may not always be the very best decision. So, it is a good idea to think about the pros and cons before you decide whether to do this or not.

 Advantages of Repaying Early

  • the biggest advantage of repaying early is that you will be able to pay less interest. A payday loan has interest charged each day that you have the loan outstanding and that means that if you repay it early, you will be able to save money. The earlier you repay it, the more money that you will save. Even if you only repay some of the money that you owe, you will be able to save money and so this will enable you to have a cheaper loan.
  • Some people do not like being in debt and so repaying it will mean that they will no longer need to worry about this. They will be able to relax knowing that the debt has gone and they are free of it.
  • If you can repay before you have to, then this could help you manage better in the month ahead. Payday loans are normally repaid on your pay day and that means it could make it hard for you to manage the rest of your bills that you will have to pay for after you get your salary. Often, we will set up direct debits and standing orders to be paid once we get paid so that we have the money available. If we have paid our payday loan off at that time, then we will not have to use some of our salary in order to pay it and will therefore have more money available for the other things that we will need to buy.

Disadvantages of Repaying Early

  • If we repay early it means that we will not have that money available to buy other things. Therefore, if we find that we then need to pay for something else, perhaps that we had forgotten about or to replace something that suddenly breaks there will not be the money available for it. This can be difficult and it means that we may end up having to get out another loan to pay for it if we cannot wait to buy it.
  • Some lenders will have a charge for those that want to repay early. It is something that is often done with mortgages and maybe some other loans so you need to check whether this will happen with the loan that you are repaying early. Ask the lender and they will be able to tell you if this is the case. Even if there is a fee, it could be worth paying if you save more interest than the cost of the fee. It could be good to ask them how much you will pay in total in each circumstance and then you will be able to easily see which will be the cheapest.

You can see that it is not really a straightforward decision. It is normally better to repay early because of the money that you save but you do need to be careful and consider the consequences of repaying early and whether you think that it will be worth it for you. Consider you own personal circumstances and this will help you to make sure that you are making the right decision as to whether it is better for you personally to repay it early.

Is it Worth Learning About Payday Loans?

You may have heard of payday loans and wonder whether it is worth bothering to learn more about them. They are pretty new which means that there will be a lot of people that have not heard of them and will therefore be looking for some help to know what they are all about. Even if you feel that it is not important because you are unlikely to use one it is still a good idea. These are the reasons why.

  • To Make an Informed Choice
    If you want to borrow money at any stage you will need to choose a loan. There are lots of different loans to choose from and it can sometimes be difficult to know which is the best for you to use. It is really important to pick the right one as well because it will mean that you will then get the best value for money. You need to think about what you are looking for in a loan and then you will be able to match that up t the best lender. Think about how much you need to borrow, what you can afford to repay and when, how much you are prepared to pay and any features of a lender that are important to you. Then you will be able to look at the different loan types and think about which is the most likely to suit you. If you do not know all about the different loans and what they are like or how they can help you, then you will not be able to access whether it will be the right sort of loan for you.
Young couple reviewing invoices and doing family business plan. Concept of money and economic problem for man and woman living together
  • In Case of Emergency
    If you need money in an emergency then a payday loan without a credit check could be the solution for you. These loans can be arranged very quickly which means that you will have the money for what you need as soon as possible. Some of the lenders will be able to get you money within a few hours of you applying and some will be available on weekends or evenings so that you will be able to get money outside of normal banking hours. This means that if you do need money quickly and you have no access to savings, overdrafts or credit cards, then they could be very useful to you.
  • So you do not get Trapped
    If you do not know much about a loan and take one out anyway then you can feel trapped by it. You might feel that you wish you had chosen a different type because it is not really doing what you expected. If you know what to expect then you will not get trapped because you will know how the loan works and what to expect from it. Therefore, even if you feel that you will not need a loan in the near future, it is wise to find out about the different types of loans and how they work as well as who they are for. Then you will be able to avoid feeling like you have taken out a loan without really knowing what you have let yourself in for. It is easy to think that this will not happen because you will look into it when you need to borrow, but often we do not have the time or the right mind set for doing it then. If we need money quickly we will often worry about what to do and that panic will stop us being able to think clearly and methodically and we will end up making rushed and poor decisions.