What is a Payday Loan?

xangeleyes

Sorry if this is a 'basic' thing that most people know lol. I've read many talking about the 'Payday Loan' Trap and was wondering what it was?

Is it just about a loan coming out on your payday??

Rachel xxx

brokeinlondon

you have to pay back the full amount on your next payday, or pay a fee to get it extended. some companies have a limit to the number of times you can extend them

ford123_2

they are short term loans you take out some lend up to £1000 and you agree to repay them in full on your next payday, beware with this type of loan i have used them and ended up getting into more debt when i couldn't afford to pay at the end of the month, the interest rates are extremely high, you can roll over into the next month but by doing this more interest is added so becomes more and more difficult to pay off, i would not reccommend using any of the companies

tallyhoh

I have seen APR's of 2255% on these sort of loans, I thought loan sharks were illegal!

krycek985

What are there credit check like ? Pretty easy to get a loan with them ?

Iv considered getting the lowest possible amount just to improve the credit rating a bit.

SamanthaA

DON`T!
Usually they have a HUGE apr, they arn`t listed on a credit check and in the worst cases they spiral out of control!

Better off speaking to a financial institution.