Life can throw a curveball at any time. There are times when you struggle to make ends meet. Having savings is a must to fall back on to meet unforeseen expenses, but sometimes luck is not on your side. Despite trying all the harder, all your efforts go down the drain. Short-term loans can come in handy when you need an immediate injection of cash.
During emergencies, it is hard for people to wait to arrange cash, and therefore, they prefer to apply from a lender who assures guaranteed approval. While this sort of thing does not exist in the real world because the lending decision is made after perusal of your credit history and income documents, some lenders may manage to maintain the highest approval rate.
A guaranteed acceptance and a guaranteed approval are not the same things. Most lenders accept applications from all types of borrowers, including those with bad credit. It means that you will not be turned down based on your credit rating; however, it will force you to bear high interest rates.
It is still advised that you carefully figure out that the lender you are applying to does not have the bare minimum credit score clause in their policy because less than that means automatic rejection of your application and a further drop in your credit score, a bad sign to stop you from qualifying for lower interest rates.
100% guaranteed acceptance loans are equivalent to guaranteed payday loans
Although there are various types of small loans, they do not guarantee that you will get approval. Even though all bad credit applications are welcome, in the end, the lending decision is based on your repaying capacity. If you are not in control of your money, your credibility will be called into question.
But amid all of these loans, 100% acceptance loans, also known as payday loans, work to your advantage. These loans are aimed at bad credit borrowers and do not involve a credit check. Lenders presume that your credit score is already bad and you need money to meet an unforeseen expense.
They will examine the income and expense details you provide in an application form and, based on that, decide how much you should be lent. The chances of being turned down are very low as long as your budget has wiggle room for debt payments.
However, guaranteed payday loans are way too dangerous. Many borrowers have come forward to complain about unethical lending practices against lenders that push borrowers into an abyss of debt. Because very high interest rates are charged, the cost of the debt quickly adds up when you roll it over.
Unsurprisingly, many people get trapped in the vicious cycle of payday debt. You should be honest while giving the account of your income and expenses, so lenders do not lend under the impression about your repaying capacity. Once you fall behind on the due date, you will not be able to cut it.
Alternatives to 100% acceptance loans
Guaranteed payday loans are not available for everyone because they are subject to a very high risk. You should use these loans only if you are entirely sure about your repaying capacity. Lenders, though, are responsible for checking your repaying capacity; they may fail to make accurate guesses. Nobody knows about your finances better than you. Consider other options. You will find them more affordable than payday loans.
Not every lender will accept your application because the bare minimum credit score range varies by lender. Before applying to a lender, make sure they have a policy to give you a chance. Here are the loans you can think of applying for when you do not want to use payday loans:
- Cash loans
They are a form of payday loans, ideal to fund small emergencies. You can apply for them online. As soon as you submit the application, receiving funds in your bank account takes a couple of minutes. Cash loans can be used for a variety of reasons, and you do not need to specify them to your lender. Interest rates will be relatively lower than payday loans, but they are still expensive.
They are paid back in full on the due date. Missed payments can ruin your finances. Be responsible while using cash loans.
- Quick loans
Quick loans are another type of payday loan. As the name suggests, you will have access to money without further ado. In most cases, you will get funds the same day until you submit the loan application late in the evening. A high interest rate will be charged, but it is slightly lower than that of payday loans.
- Small loans
Short-term loans typically include those with a minimum payment term of three months, but some lenders also include emergency loans. As you need a very small sum of money, you will be required to pay off the debt in fell one swoop.
All the aforementioned alternatives are similar to payday loans. In other words, payday loans are offered using other names. Interest rates will be more or less the same, and the payment term will not be more than a period of a month, and you will have to clear the debt in one go.
What if you slightly need a larger sum?
Most of the instant loans come with a small sum of money, usually not more than £500. However, there is a possibility that you will need double or even more than that. Here comes the role of small loans.
A few lenders are out there who will let you borrow a more considerable sum to meet emergency expenses as well. As the loan amount is larger, you will pay down the debt in fixed equal instalments. It depends on the size of the loan and whether the instalments will be wrapped up in three months or six months.
Instalment loans are more affordable than guaranteed payday loans and their alternatives. Your credit score and repaying capacity will be thoroughly checked, and the good thing is that you can qualify for these loans despite a poor credit score, and yet you will manage to qualify for lower interest rates than instant loans.
The alternative that does not cost you any interest
The best alternative is none other than an emergency cushion. A rule of thumb says that you should consistently keep setting aside money for a rainy day. Even if it is just a paltry sum, it will help save you a lot of money in interest that you would otherwise pay if you borrowed money.
Make sure you do not dip into your safety net for regular expenses. If they still fall short of some cash when you find yourself in a tight spot, you can apply for instant loans. As these loans are quite expensive, you should carefully take stock of your repaying ability.
The bottom line
100% acceptance loans can be a good choice when you need an immediate cash injection. Your chances of approval are quite high because money is lent based on your monthly income and expenses. There is no role of your credit history, but this is why these loans are quite expensive. Do not throw caution to the wind while using these loans just because they are quickly accessible.
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