If you are struggling to find enough money to pay your rent then you may be looking around for options to help you. It might be that one consideration could be to borrow the money. This could be a reasonable idea, but you will need to find the right type of borrowing. If you are considering a payday loan, then it could be the right option, but it depends on a few factors.
- Are you a UK resident and over 18 with a bank account and regular income? There are few basic requirements that you need to have in order to be able to qualify for a payday loan. There are a lot less than with many other types of loan, for example no credit check is done so you do not need to worry about whether you have a good enough credit record. However, you will need to be a UK resident and over 18 to fulfil legal requirements and you will have to provide proof of address. You will need a bank account so that the payday lender can set up a direct debit in order to collect the payment when it is due. You will also need to be able to show that you have a regular income which would normally be a job but benefits or pension might be enough to qualify depending on the lender. The amount of income will not be that relevant you just need to show that you will have enough to repay the loan and let the lender know when you get paid so that they can set up the direct debit to repay the loan on that day.
- Do you need less than £1,000? It is important to know that a payday lender will not normally lend more that £1,000. This means that if you need more than this then it is unlikely that you will be able to borrow it. You also need to think about the fact that payday lenders may not lend large sums of money to first time borrowers. It is very possible that they will prefer to lend a smaller amount of money first to see whether you repay it successfully before they lend you a larger amount. This may vary between lenders and so you may have to do some research to find out which lenders are more likely to let you borrow the amount that you need. If you cannot borrow the amount that you need, then you may need to come up with an alternative plan.
- Will you be able to repay it when you next get paid? You will repay all of the payday loan when you next get paid. Therefore, you need to be sure that this is something that you will be able to afford. In order to find out, you will need to do some calculations. Firstly, you will need to know exactly how much you will need to repay. To find this out you will be able to use the calculator on the lender’s website. You can enter the details of how much you want to borrow and how long for and you will be able to see exactly how much you will have to repay. If you cannot find the calculator then contact their customer services department as they will be able to help you with this. Then you will need to take a look at your bank statements so that you can check to see if you will have enough money to cover it. Think about where you might be able to reduce your spending so that you are sure that you will be able to afford it. You might be able to earn more money as well, which could be very helpful. It is also good to make sure that you will be able to manage all of your other bills as well for the following month. Check how much you need and whether you will have enough.
- Is the money needed regularly or just once? Whether a payday loan is suitable to help you with your rent can come down to whether you need it just once or more often. If you are just having a tricky month and need some help then it can be very useful as long as you are confident that you will be able to repay it. However, if you are struggling each month with the payments then a payday loan will not help. You will need to get one every month and then pay it off and find more money. It could be better in this situation to budget harder so you can manage the rent or consider renting a cheaper place. Getting a better paid job could also be an option that could help you. If you have a plan to help for the future, a payday loan might be a temporary solution.