A payday loan UK which is also called a payday advance, salary loan, payroll loan, short term loan, or cash advance is a small, short-term unsecured loan, repayment of loan is linked to a borrower’s payday.
The loans are also referred to as “cash advances,” though that term can also refer to cash provided against a prearranged line of credit such as a credit card. UK Payday advance loans rely on the consumer having previous payroll and employment records. Legislation regarding payday loans varies widely between different countries and states.
To prevent usury (unreasonable and excessive rates of interest), some jurisdictions limit the annual percentage rate (APR) that any lender, including UK payday lenders, can charge. Some jurisdictions outlaw payday lending entirely, and some have very few restrictions on payday lenders
Eligibility for UK payday loans
As with other types of loan from other lenders, you need to meet certain criteria in order to qualify for a payday loan from Green Touch. You must typically:
a) Be a UK citizen
b) Be 18 years or older
c) Have a checking account with direct deposit eligibility
d) Have held steady employment in recent months
The majority of lenders – including banks and other financial institutions – require these four criteria. A checking account that receives direct deposits is typically a requirement for online payday loans, as this is the way your loan will be paid to you.
Proof of steady employment is usually required so that the online payday loan lender is confident that you can repay your loan on time.
A payday loan – which might also be called a “cash advance” or “check loan” – is a short-term loan, that is typically due on your next payday.
Payday loans generally have three features:
- The loans are for small amounts.
- The loans typically come due your next payday.
- You must give lenders access to your checking account or write a check for the full balance in advance that the lender has an option of depositing when the loan comes due.
Other loan features can vary. For example, payday loans are often structured to be paid off in one lump-sum payment, but interest-only payments – “renewals” or “rollovers” – are not unusual. In some cases, payday loans may be structured so that they are repayable in installments over a longer period of time.
Some ways that lenders might give you the loan funds include: providing cash or a check, loading the funds onto a prepaid debit card, or electronically depositing the money into your checking account.
The cost of the loan (finance charge) may differ for every money borrowed. A typical two-week payday loan with a 15 per 100 fee equates to an annual percentage rate (APR) of almost 400%. By comparison, APRs on credit cards can range from about 12 percent to 30 percent.
State laws and other factors can influence how much you can borrow and the fees you are charged. Some states do not have payday lending storefronts because these loans are not permitted by the state’s law, or because lenders may choose not to do business in a state rather than abide by the states’ regulations.