Payday loans

Payday loans can sound very tempting, but with interest rates as high as 2,000% APR or maybe more, they can become expensive. This type of loan loans let you borrow small amounts of money for a week or a month. It’s the high interest rates which can cost far more than you bargained for. A Payday loan allows you to borrow from £50 to £1,000 for a few days or up to a month, just until you get paid the following month. They generally charge up to £30 for every £100 cash loan you borrow. Sounds good, but it equates to an APR (annual percentage rate) of a whopping 2,255%. The idea is emergency cash for a short period without having to visit your bank. In some cases credit checks are not done at all, but a cash loan of £500 for 31 days could cost almost £150 in interest – that’s almost £5 per day. If you choose this type of loan, make sure you budget to pay the cash advance back on the agreed term so there’s no need to get another payday loan the following month. Payday loans have been the cause of getting people into debt that they are unable to get out of.