You may be considering a payday loan, but if you have not taken out one before then you may have quite a few questions about it. There are lots of things which you might not know about it and it is a really good idea to get all of your questions answered before you take out the loan. There are lots of different things that you might want to know and one of them is how much you will be able to borrow. This is not necessarily an easy question to answer.
Usually you will find that a payday lender will allow you to borrow up to £1,000. However, this will vary between different lenders. They tend to start at £100 for the lowest value loan, but this may also depend on the lender. It will vary a bit and if you find a lender that you can repay in instalments (often referred to as instalment loans) you may find that you are more likely to be able to borrow larger amounts of money.
You will find though, that lenders may not be willing to lend large amounts to everyone. They do not do a credit check which means that they will need to build up trust with you in a different way. They will often only agree to lend you smaller amount of money to start with. Then, if you successfully repay the loan when required, they will lend you larger amounts. This means that it can be tricky to be able to borrow a large sum from a lender that you have not used before. However, this will vary between lenders, so if you do need a larger sun of money then you may need to just contact several and see whether they will be willing to lend you the money or not.
What Should Your Borrow?
It is wise to also think about how much you should be borrowing. It can often be tempting to just borrow as much as we can because we will be able to use the money for the specific thing we need it for and then have some extra money to treat ourselves with. However, this is not a sensible idea. We need to think hard about the cost of borrowing the money and the fact that it will cost more if we borrow more. We also need to think about the fact that we will need to repay the money. We need to find out when we need to repay it and how much we need to repay and calculate whether we will be able to manage this. With a payday loan, we will need to repay the money on the next day we get paid. You may feel that this will be fine because you will be paid on that day so the money will be there. However, it is important to check this carefully because you may find that you have other things that need to be paid for on that day as well and these will take up the money you need to repay the loan or vice versa. You will also have other things that you will need to pay for such as food during the month and so you will need to make sure that you have enough money left for this as well. Therefore, it is a good idea to actually write out how much money you will need and then you will be able to work out whether you will have enough left after repaying the payday loan and your other bills.