How to choose a payday loan: Tips for saving money
The payday loan is a reliable source of funding that will allow you to realize your projects, without you having to provide proof. This freedom of use of funds is both an advantage and a trap with this credit for consumption, because you can use it to go on a trip, to make a reserve of money, to finance the studies of your children and well other possibilities. But in case you decide to buy material goods or request a service, you have no guarantee if the product is defective, and you will have to continue to repay the credit. To avoid getting there, take the time to think about your payday loan by revisiting one by one the criteria of choice.
All you need to know about payday loans
Before you begin the process of obtaining your payday loan, take the time to find out. So, be aware that the payday loan is a form of consumer credit proposed by banks, and that will allow individuals to carry out personal projects, without having to provide evidence of use of funds.
What’s more, the amount, rate and terms of repayment of the payday loan are set in the contract you are going to sign. Thus, you will know in advance the duration of the repayment which will be made in constant monthly payments.
Payday loan: a budget adapted to your needs
To choose the right payday loan, define in advance your financial needs and your repayment possibilities. And most importantly, avoid signing a pledge that is too burdensome to bear with your monthly budget. In fact, make it a habit to always have some leeway in anticipation of financial difficulties such as a drop in income.
In order to find the payday loan formula that will be more profitable, do not hesitate to compare the offers available on the market. To do this, you can inquire at your bank, credit organizations that will gladly provide you with a pre-contractual information sheet on the payday loan.
To make your life easier, opt for online banks that provide online simulation tools that will help you find information about this credit. Other online loan comparators will guide you to several offers from banks based on the information you have provided: the amount of credit requested, the cost and / or the duration of the monthly payments.
At the end of your research, you will obtain the details of your payday loan which are the amount you will borrow, the duration of the credit, the cost, the number and periodicity of the installments, the total cost of the loan and the APR (annual rate overall workforce) which allows you to have a clear idea of the total amount of your credit. This information will then be used as a reference when you go to other banks to find the best rate for your payday loan.
A payday loan at the best rate
The total cost of the payday loan depends mainly on the APR, the annual percentage rate of charge. To find an offer at the best rate, the APR serves as a reference. To calculate it, the financial institutions will apply a standard on a European scale and take into account the nominal rate which refers to the interests of the loan, the handling fees and the cost of compulsory insurance.
This APR will cover all the mandatory fees you will have to pay outside the borrowed capital. The APR is also used to confirm that the payday loan rate is well below the rate of wear (maximum rate allowed). Moreover, the APR will serve you to compare the many offers offered by the banks and you can refer to them for successful negotiations. To reduce the rate of your credit, take the time to compare the offers using online simulation payday loan sites, and negotiate your fees and the nominal rate applied by playing on the competition. Then, reduce the rate of your payday loan by opting for a shorter repayment period with higher monthly payments if your financial situation allows you.
The terms of the payday loan agreement
Any credit agreement is drafted by applying different conditions imposed by law. With the payday loan, the lender is required to respect the conditions of the loan offer for at least 15 days from the signing of the contract. For your part, you are entitled to a period of approval of 7 days to accept or not the payday loan agreement. And if you decide to sign and accept all the conditions of the contract, you still have 14 days of withdrawal period to provide for a possible change of mind. As soon as these deadlines are over, you can expect the release of the funds that will be directly paid into your current bank account.
Payday loan, the precautions to take
Depending on the amount of money you ask for as part of your payday loan, the bank reserves the right to take security measures. Thus, you will have to provide proof of income. As for the borrower, insurance for payday loan will be strongly recommended to prevent possible bankruptcies, unemployment, disabling accident, illness, death that will prevent you from ensuring the repayment of credit. For a matter of logic, the credit agencies will grant significant funding to a person in good health, with a stable work situation and who does not risk sports to avoid the worries of unpaid.
To choose the right payday loan, take the time to make a comparison of different offers available from banks, and when you have a favorable response, do the same with insurance. Finally, choose an institution that offers a favorable rate, along with reliable customer services such as the assessment of your ability to repay and the calculation of your “rest to live” to find your debt ratio.