Payday Loans in Glasgow
As is the case with many other cities in the UK, it is not uncommon for Glasgow residents to face financial difficulties. The west-central Scotland city has an unemployment rate of 4.7%, which is higher than those of Scotland and the UK, which stand at 3.5% and 3.9% respectively.
Additionally, studies show that 31% of the UK population report one or more signs of financial difficulty, while about two million residents took out high-cost loans in 2012, due to a lack of credit, and lending volumes have only increased since. Over 5.4 million high-cost, short-term loans were taken out just last year, in 2019. Plus, UK residents of all ages are utilizing this form of cash relief; it is reported that 37% of payday loan borrowers and 29% of short-term installment debtors are between the ages of 25 and 34.
Short-term loans such as payday loans can help Glasgow residents who are struggling financially and need a little extra cash to get through the month.
What is a Payday Loan?
Payday loans are short-term, cash advances that can provide financial padding during difficult times. Consumers can use these loans to pay for unexpected expenses, overdue bills, and other extenuating monetary circumstances.
As is implied by the name, quick payday loans are intended to be paid back with a borrower’s future salary. This means that loan repayment is typically set to the time of the debtor’s next paycheck, at which time interest must also be paid. Unlike personal loans that can be paid back in increments over a set duration of time, payday loans are required to be repaid in one mass sum. Payday loans are meant for short-term use and not long-term debt obligations.
How to Apply for a Payday Loan
Residents can apply for such loans at payday loan shops in Glasgow or through online lenders. Quidable can also connect potential borrowers to lenders in Glasgow. Our online application is free and secure to use.
There are a number of points that borrowers should keep in mind before applying for a loan:
● Make sure the minimum requirements are met.
In order to be eligible for a loan, residents must meet certain requirements outlined by the Financial Conduct Authority or the FCA. The FCA determines interest rate caps, maximum loan amounts that can be borrowed, and other regulations lenders and borrowers must adhere to. These requirements are typically outlined at the start of the loan application process and will be discussed in further detail below.
● Know your limits.
Borrowers should only take out loan amounts that they can afford, and should not request more cash than their income can cover. Failure to repay loans on time can result in fees and can negatively impact one’s credit score.
● Work with a trusted lender.
It is important that interested applicants research lenders before applying for a loan. There are instances of predatory lending that can occur if borrowers are not careful. Borrowers should read and fully understand all loan terms and conditions, in order to make better-informed decisions.
Payday loans in Glasgow operate like other short-term loans in the UK. Borrowers must:
- be 18 years of age
- be a resident of the UK
- must provide legal proof of regular monthly income
- must have and be able to present a current bank account
Once an application is made, it is then up to the lender to determine if an applicant is approved or not. If a candidate is approved for a loan, he or she will typically have to sign a loan agreement set forth by the lender. Residents are usually able to access their loan funds within a few business days. This will ultimately depend on the lender and the borrower’s unique circumstances.
As mentioned above, the FCA has regulations in place that restrict the number of lenders that operate in Glasgow and to protect borrowers from malpractice. For example, interest fees cannot be greater than the capped percentage of 0.8% per day of the loan amount that is borrowed, and default charges cannot be greater than £15.
Does Credit Score Matter?
For almost all traditional loans, lenders will examine a potential borrower’s credit report and credit score. Credit scores are used to determine an individual’s credit risk, assess an applicant’s capability to repay a loan, and sometimes determine the interest rate that will be charged.
Although payday lenders may have more relaxed rules in comparison to conventional lenders, they too want to ensure that their borrowers are able to afford the necessary payments. Some lenders will offer guaranteed payday loans for bad credit or bad credit payday loans, but such assertions are false. Short-term loan lenders do not offer no-credit-check payday loans, and as is typical with other loans, an applicant’s credit history will play a role in determining if a loan will be granted or not.
But payday lenders take more than just credit histories and scores into consideration. Most will also take an individual’s income and banking situation into account when deciding if to approve or reject an application.
UK borrowers may be drawn to high-cost, small-euro loans due to flexible application processes and fast loan approval. It is important that residents remember though, that they are usually expected to repay their loans in full when it is due. Borrowers should be able to repay their loan amounts in order to avoid getting into potentially worse and more precarious financial situations than before.