While taking out a loan of any kind is a commitment that needs to be considered in a careful and responsible way, there is no reason for the experience to become overly complicated or stressful. In fact, if you’re calm and equipped with the information you need, you’re much more likely to make decisions that will be appropriate for you and your lifestyle. As MYJAR is a responsible provider of short-term loans, we make sure that our customers get all the information they need in one place to really understand their loan before they commit themselves.
In order to help simplify your decision-making process and ensure you’re armed with the most useful knowledge available, we’ve put together 5 things we think you ‘need to know’ before taking out a short-term loan.
Does it Suit Your Needs?
There are numerous types of loan out there, and it can be a confusing task to sort through them and decide which one is right. Remember: a short-term loan will only be suitable for you if you’re looking to take out a relatively small amount of money for a short time. If you are looking to make a large purchase or investment, such as a deposit on a house or a new car, you should approach your bank or credit union. However, if you need to buy a smaller item and you know that you can pay the loan back after your next payday, you should look into the short-term loan option.
Can You Comfortably Pay it Back on Time?
One of the most significant ‘need to knows’ is the importance of ensuring you can pay your loan back on time. Think about this carefully before you make a commitment. After all, your finances are central to your life and you'll want to protect them. If you are already struggling with your finances, borrowing more money will often only make things worse.
Understand the Cost
Make sure that you understand what the true cost is. APR is sometimes confusing, but always check how much it will cost you in money terms, when you will have to pay and perhaps most importantly, what the costs are if you don’t pay on time.
Are you Borrowing from a Responsible Lender?
Be aware that taking out multiple loans is an irresponsible borrowing practice. Do not plan to take out more than one loan and pay off existing debts with other borrowing. MYJAR has a ‘no rollover’ policy to prevent our customers from entering into an unhealthy borrowing cycle.
Have all Your Information to Hand
Filling out your application form accurately and honestly is essential. At MYJAR, we put certain conditions and checks in place for a good reason: we want to protect our customers’ financial stability. Before you apply for a loan, have an honest talk with yourself. Can you definitely afford the loan repayment? Are you 100% eligible for a loan? In the long run, you will find this to be the most helpful and sensible way to approach borrowing.
Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk