Same day loans are relatively small, unsecured loans that you can apply for on the high street or online. With quick processing and a high approval rate, same day loans for bad credit can be an excellent choice for someone who does not have other options for fast money, or if you are taken by surprise by an unforeseen expense. Everyone has some sort of financial emergency from time to time, and it's good to know there is a solution waiting at your fingertips. But is a same day loan right for you, or are you better off looking for other options?
What Can A Same Day Loan Be Used For?
If you're trying to discern whether or not a same day loan is right for you, then you need to know what you can potentially use it for. Why do people get same day loans, and can you benefit from them in the same way?
If you're looking for some help with budgeting in the new year, then perhaps you could use a same day loan. Sometimes it makes sense to get a larger loan in order to pay off a large expense, so that you can then continue to repay the loan in instalments. That makes financial sense, because it fits into your budget easier, and it can help you improve your credit rating!
By far, the most common use for a same day loan is just regular, everyday expenses. 53% of borrowers stated that they use loans in this way, according to the Competition and Market Authority. With prices rising and wages decreasing, sometimes the way to make ends meet is to get a little extra help on the side from same day payday loans. If you find yourself in need of a bigger budget for regular bills and expenses, do not hesitate to ask for help.
Then, we've got emergencies that just cannot be foreseen or avoided. No one can sense when an emergency trip to the dentist will be needed, or when your vehicle will decide to stop working and require an expensive replacement part. These things happen, and we either need to be prepared for them with an emergency budget set aside, for make do with a financing solution, like a same day loan with no fees.
The Issues With Same Day Loans
Just because something has drawbacks, it doesn't mean it's not a viable option. But it's important to be fully aware of both advantages and disadvantages when considering a financing option. In the interest of being informed and responsible, let's discuss some of the issues that arise with same day loans.
The interest rate is high
The most obvious disadvantage with this type of lending is the interest rate attached. Because this is an unsecured loan that is granted so quickly, the lender has to secure themselves somehow, and it's usually through a high interest rate. 270% APR is definitely not the most expensive unsecured loan on the market (there are loans with an eye-watering 1600% APR), but it can mean it costs a lot to repay.
The amounts are not very high
The other thing is that the amounts you can borrow are not exceptionally high. Usually, they fall between the £50 to £5000 range, but most commonly they sit at around £1000. If you're only interested in a small sum that you plan to repay immediately, that's not going to be a problem; if you need more, however, you're out of luck.
The repayment term is short
And since the amounts aren't large, repayment terms are not exactly generous, either. You can expect 1 to 3 months, 6 months, or 12 to 24 months, depending on the lender and the amount you've borrowed. That means you need to produce the money fairly quickly, and if you add interest as well, you may find it difficult to repay.
Are There Alternatives To Same Day Loans?
Of course, if a same day loan is not your cup of tea or you don't fit the profile, there are other options you may want to explore, so why don't you compare:
- Same day loans vs. Doorstep loans
- Same day loans vs. Payday loans
- Same day loans vs. Credit cards
- Same day loans vs. Logbook loans
- Same day loans vs. Cash advances
- Same day loans vs. Peer to peer loans
Is A Same Day Loan Right For Me?
So, after weighing all of your options and all the information, do you know if a same day loan is right for you? If not, let's look at a handy cheat sheet that lays it out for you clearly and can help you decide.
|- You can afford the repayments||- You cannot afford to repay the loan instalments|
|- You are ok with paying interest||- The interest rate is too high for you|
|- You are able to repay in a few months||- You can’t keep up with repayments for several months|
|- You have an unexpected one-time expense||- You rely on loans monthly|
|- You have an emergency||- You don’t need the money quickly, you’re just impatient|
|- You need to pay household bills||- You often use loans to cover impulse purchases|
Same day loans, like all financing solutions, have benefits and drawbacks that you need to consider. They can certainly make for a very helpful option for someone who is in a pinch and needs some extra money fast, but there are also some less flattering aspects you need to look at, such as interest. But if you think same day cash loans are worth it, why wait? Get a loan today!