Time and again we hear debt trap stories about payday loans UK no credit check online approval. Are they merited or a case of misinformation? Julie asks:
“For someone with no access to bank loans, I welcome private lenders who offer quick loans even for people with poor credit. However, I also read about too many sad stories about borrowers falling into a debt spiral because of these loans. What’s the real score with these loans?”
Payday loans UK no credit check online approval are no different from mainstream loans. They can be both good and bad for the borrower. The key is to manage these types of instant approval loans.
Because they are unsecured and easy to get instant approval, they can be abused both by the borrower and direct lender. The negative effect even led to a call to ban this type of loans with fast online approval, including a petition by the University of East London last February.
There’s a caveat with this petition, though. Most borrowers with no access to mainstream lenders like banks and credit houses depend on payday loans UK no credit check online approval for emergency cash. These are loans with guaranteed loan approval even for people with bad credit. To ban these loans would mean denying borrowers access to legitimate unsecured loans that they can borrow even if they have no collateral.
On the other hand, a direct lender can also be abusive. They would give instant decision and hand out the payday loans UK no credit check online approval immediately in one hour, if not by tomorrow, even if they know that the borrower has no way of paying back in full. Their aim is to earn from the penalties, not from the interest of the loan. Unfortunately, these loan sharks are the ones getting more press and they put the whole payday loans UK no credit check online approval industry in a bad light.
Your best bet as a borrower is to only use the loan for emergencies. These include accidents, house repairs, and car repairs. Likewise, make sure that you have a conservative income projection that can repay the loan within a few weeks. You should also choose lenders that have a good track record. These lenders will have a complete website and communication lines that you can tap into. Also make sure that the lending agency has a business permit to operate in your area.
Our verdict—payday loans are a necessary evil. They can be useful if handled properly. I will support their ban if lobbyists can provide a better option, but as long as banking institutions discriminate against low-wage earners, payday loans can offer more benefits than ill-effects during tight financial situations.
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