People who apply for payday loans are often in a rush. Because of this, they are not usually thinking straight, which means they are more likely to make mistakes.
The main problem is that making mistakes in the payday loan world means that you end up losing money, and when money is scarce to begin with, this is not something you can afford to do.
With this in mind, here are 4 common payday loan mistakes you must be aware of…
Not choosing the right lender
There are many different payday lenders online, but only a small minority of them are worth doing business with. For example, many will add hidden fees and charges onto the money you have borrowed, which means you end up paying back a lot more than you should.
You should only choose legitimate lenders such as WhiteLoans.co.uk who have been in the industry for many years, and are totally honest and upfront about the total amount repayable. If you get a bad feeling about a lender, then should avoid them and look elsewhere.
Borrowing more than you can afford to repay
Probably the biggest mistake that people make with payday loans is borrowing more than they can afford. For this reason, you should look closely at your finances before applying, and work out how much money you can comfortably borrow.
At the end of the day, if you borrow too much then you will find that you miss the payment deadline and end up with extra fees added to the principal.
Not only that, but a note of the missed payment will be recorded on your credit file, meaning your credit score is negatively affected. Don’t take the chance.
Not understanding what you are agreeing to
This is a common mistake made by people new to the world of payday loans, and often results in them getting a shock when it comes time to repay the loan. For example, if you borrow $200, then with the added interest, the total amount repayable could be around $240.
That is why you need to read the terms and conditions before accepting the loan, so you know what the interest rate will be and how much is repayable.
Not telling the truth
Lastly, you should always tell the truth on your application. Lying about your circumstances is a big mistake, and will almost certainly mean that your payday loan application is rejected.
Lenders check all of the details that you supply, and if something doesn’t seem right then you can say goodbye to receiving any money.