PPI, otherwise known as Payment Protection Insurance is a policy designed to cover the holder against falling ill, suffering an accident or becoming unemployed and so not being able to cover the cost of loan or credit card repayments.
Bought in conjunction with an application for personal finance, PPI is becoming increasingly publicised for the wrong reasons. Banks and lenders across the UK have been fined millions for routinely mis-selling PPI to their customers for many years, policies were mis-sold to customers who didn’t need, want or were ineligible to have it.
Complaints have risen enormously in the last few years and with a large proportion of the UK’s population being able to make a claim of on average £3000 its becoming a financial burden on the largest lenders. Banks such as Lloyds have put billions of pounds in reserve to cover the cost of compensating the thousands of customers they mis-sold to, Lloyds alone have set up provisions totalling £3.2bn.
With the window for PPI reclaiming shortening its time to see if your bank owes you thousands in compensation.
If you have a loan, credit card, store card, mortgage or any other form of personal finance you could have been paying for PPI protection for many years without realising it so its time to check your statements, policy documents and application information to see if you have PPI charges attached to your account. If you do, then you need to be able to qualify as being mis-sold the policy before you can proceed to make a claim for compensation, typically these are the common reasons why you could have been mis-sold PPI:
- The lender did not tell you that PPI was optional.
- The lender did not tell you that PPI was a standalone policy and could be purchased elsewhere, often cheaper.
- The lender implied that PPI was compulsory or that it would benefit your application for finance in any way.
- The lender added PPI to your application without your knowledge or consent.
- You were unemployed, self employed or retired at the policy start date.
- The lender did not tell you in detail about the policy exclusions including stress and back related time off work.
If you sit in any of the above categories then you could claim back PPI compensation from your lender, on average this is worth £3000. Claiming back is simple but you have two options in how you can pursue your case, you could either do it yourself using templates and guides available online or you can use a PPI claims company to process your claim for you, they will be dealing with the banks on a daily basis and know all the ins and outs of your case. The chances are that using a company to help will increase your chances of being compensated quicker.
A PPI claims company will generally act on a no win no fee basis but they will ask for between 15 and 25% of the total compensation plus VAT so a very large chunk is taken by them if successful, though because they know all the ins and outs of the process they may well be able to claim back more money that you would by going it alone so its a choice worth taking in most cases. Another thing to factor in is that a PPI claims company may be able to help you identify other loans, credit cards or other forms of credit you could claim on so 75% of another claim is better than 100% of nothing!
You can find some great help if you want to use a PPI claims company here or if you would prefer to go it alone there are some great claim templates over at moneysavingexpert.com.
Since the early 2000′s there has been a notable change in peoples borrowing habits, and a massive change in the banks lending requirements. Many people are now looking for no credit check loans. With the majority of normal people unable to find any credit it is not surprising that many have turned to lenders that were unheard of just a few years ago. These lenders by comparison can prove very much more expensive, but many people have found when it comes to loans especially on a no credit check basis they have little or nothing to choose from.
Over the last couple of years there are two types of loan that have specifically caught the attention of UK borrowers; both these loans have been ideas imported from the USA and have proved exceptionally popular during the recession. While no loan should be taken without first carefully considering the terms and conditions if you are looking for a no credit check UK loan you may want to consider one of the following.
Payday Loans
Payday loan lending has increased over 241% over the last 4 years in the UK, from £1.6 million in 2006 to £4.1 million in 2010. These loans although originally devised for the US market have caught on very fast and it looks like the trend is destined to continue.
Payday loans are popular for a number of reasons but primarily for their ease of use. Most Payday Lenders carry out no credit checks, do not require their borrowers to fax any details and can provide the loan within 24 hours. Also, the application can be fully completed online without ever having the need to meet someone in person or discuss the loan over the telephone.
Payday loans no credit check charge £25 per £100 borrowed, and many allow you to roll over this amount to the following month with only a payment of interest.
Logbook Loans
These loans are a very different beast to Payday Loans and offer lending on very different terms. As with payday loans they run no credit checks and will provide their services to even those with a very poor credit history. Logbook loans offer lending over a much longer period of time, but insist that they receive a vehicle as collateral. The lenders state that they will lend up to £50,000 but in truth any loan offered will be approximately 50% of your vehicles value.
Remember that no credit check loans will provide loans quicker, but these will usually (in almost all cases) have a much higher APR rate than you would normally expect from the far more conventional bank loan, or conventional secured loan. When taking one of these loans be sure you can afford the repayments and ensure that you are willing to pay this inflated interest. If you are already struggling.
Every year, more and more instant payday loans companies go into business. And this doesn’t even include other bad credit lending options such as logbook loans. Whether you live in the UK, the US or any other part of the world, you are certain to come across payday loan options. Some of these cash advance options will be in the form of pay day loans companies with physical business addresses whereas others will strictly be in the form of online payday loan companies. Whether you are hoping to borrow money from a local payday loan company or one which has online access, you want to compare the options quickly prior to obtaining the payday loan.
Comparison sites have a nice advantage that lender sites do not and that is that they allow you to surf through the different lenders with ease to help you make an informed decision. Not only do they let you look at all the different lenders all at once but they can also provide you with the different rates and fee information you need so you can see which one is best for you.
There are a few ways to compare these companies and make the best payday loan decision. Here are some things to consider when comparing payday loan companies, but first you need to:
Decide Whether You Will Be Borrowing From a Physical Location or Online
In order to compare your options in the quickest manner, you first must determine whether you will be obtaining your payday loan through a cash advance company in your area or whether you will be going through an online company to get your money. This will help to narrow down the options and aid you in choosing the best company.
Determine the Amount Needed
Next, figure out how much you want to borrow on the payday loan. As payday loan companies have caps on how much they will lend out to an individual, you want to choose a company which will meet your funding needs adequately. By knowing how much money you have to borrow, this will also help by making it less likely for you to over borrow.
Once you have decided whether you are borrowing from a physical location, or online, and decided on the amount you require you are ready to look at the terms offered by the various lenders. Look for information related to the points discussed below:
Compare Loans to Obtain the Most Favorable Interest Rates
When you compare payday loans, chances are that you will find the most favorable fees along the way. Should you simply pick a payday loan lender from amongst the bunch, you probably will pay more in fees than if you shopped around briefly for the best payday lender out there. Fees can be pretty high, especially if you don’t look around prior to settling on a payday loan. Since this will boost the repayment price up quite a bit, you want to be sure that the fees are as low as possible. The interest rate will often be the determining factor when there is a tie between two different payday loan companies and you are unsure as to which company you should go with.
Get the Amount You Need
Another reason to compare payday loans is that you will get the amount that you need. As payday loan companies have caps on how much they will lend out to an individual, you want to choose a company which will meet your funding needs adequately. By knowing how much money you have to borrow, this will also help by making it less likely for you to over borrow.
Obtain the Best Repayment Terms
An additional factor to consider in order to help you decide on a payday loan company relates to repayment terms. You want to have enough time to repay the cash advance yet not have it be too late due to the potential fees attached to longer repayment terms. Most payday loan companies will have a form to review which tells you everything you need to know about the payday loan, including the repayment terms. Read the entire document carefully and be sure to specifically review the repayment terms to ensure that you can pay back the loan without too much added expense.
Consider Reputation of the Payday Loan Lender
When you are in the midst of comparing payday loans, make sure that you don’t neglect to review the reputation of the payday loan lender. A payday loan lender which has been around for awhile, has a good client base and is fair in their business dealings is usually the best one to go with. Take this knowledge and compare it with the other aspects they offer to their borrowers. If your lender has a good reputation and offers low fees on the payday loan with favorable terms, they are probably the best one to go with.
When you compare payday loans, you will get a true idea as to which loan will suit you best and get you the money that you need quickly. Comparing payday loans does not take a long time and it is best to be armed with as much knowledge as possible when obtaining a quick money loan.
When people first start looking for a no credit check loan online they might get feel bombarded by a huge number of websites, lenders and brokers. Not to mention a large amount of websites that simply look like scams or have a dodgy feel about them. One of the more specific decisions to be made is to decide between payday loans or a logbook loans. They appear similar on the surface but there are several crucial differences between the two forms of no credit check loan.
*Use our quick comparison below or visit our home page for full comparison!
| Lender | Debit Card | Loan Amount | Interest | Documents | Apply |
| 3. | Payday UK | Not Required | £80 - £750 | £25 per £100 | Not Required | PROCEED |
| 2. | Quick Quid | Not Required | £100 - £150 | £14.75 per £50 | Not Required | PROCEED |
| 4. | Payday Express | Required | £80 - £800 | £25 per £100 | Not Required | PROCEED |
| 1. | Payday Bank | Not Required | £80 - £750 | £25 per £100 | Not Required | PROCEED |
| 5. | Purple Payday | Not Required | £100 - £750 | £25 per £100 | Not Required | PROCEED |
This article will first look at the similarities between the two most popular forms of bad credit loans and then go on to list the differences. Some of these may be obvious to readers who have done some research online, but some things are more subtle and may effect the decision made by the potential borrower.
Similarities between log book loans and payday loans
- Both types of loan are no credit check loans.
- Lenders of both types of loan will lend money to borrowers with very bad credit or who have been refused by other lenders in the past
- Borrowers can make the initial application online for both logbook loans and payday loans.
- Both have higher APR rates than mainstream lenders which reflects the fact that they lend to lenders with very bad credit who are seen as a bigger risk.
- Log book loans and payday loans are both often seen as fringe financial products and not part of the mainstream lending industry. This also includes some people having a bad opinion of the industry as a whole.
- You need to be aUKcitizen over 18 years old to borrow money.
Differences between logbook loans and payday loans
- With a logbook loan your loan is secured on your vehicle. This means that you may lose your car if you fail to repay the loan. However the borrower keeps full use of the car during the loan period. With payday loans the lender makes sure that the borrower can repay the loan i.e. has an income and then issues unsecured loans rather than secured loans like logbook lenders.
- You can borrow larger amounts of money with logbook loans than payday loans. This is because they are car secured loan, meaning that a borrower can take as much money as he or she wants as long as the value of their vehicle covers the loan amount. Lenders often lend half the market of value of the vehicle. Payday loans tend to be loans of less than a £1,000, whereas logbook loans may go as high as £50,000 if an expensive vehicle is used as collateral.
- Logbook loans have a lower APR than payday loans. This is because they are car secured loans, but also because the loan period is usually much longer. Whereas a payday loan is taken out for a month at a time – until payday – a logbook loan might have an 18 month repayment period.
- There are far more payday loans lenders available to choose from than logbook loans lenders in the UK at this time.
This week offered new insights into the number of middle earning professionals relying on Payday Loan companies to get them from one pay cheque to the next, and the statistics appear to confirm that even those with a higher earnings bracket than the national average are struggling to make ends meet.
The leading payday loans lender ‘Instant Loans Direct’ have said that following a review of over, 75,000 of their customers around 57% of their customers earn between £25,000 and £50,000 per year with 75% of all customers being between the ages of 25 and 45.
These statistics are sure to strike a cord with consumer action groups who have been calling for the banning of such lending practices, but in a time when banks are not lending it appears that bad credit borrowing is the only option for many.
Giles Coutts of Instant Loans Direct says: ‘Many assume it’s only those on low incomes struggling to get cash from their bank and who resort to payday loans.
‘But it’s actually the middle-earners whose budgets are being bust and who need the cash most desperately to cover them, usually for ten days until payday.’
James Falla, personal debt consultant at beatmydebt.com was fast to warn those struggling with their debt not to be tempted by payday loan companies, but instead seek advice on dealing with their debt.
“More and more we are seeing people who are already with significant personal debts turning to payday and doorstep loans to make ends meet. But borrowing more in these circumstances is simply not the answer and will make things worse” he said.
“It is far better to consider a sensible debt management solution such as a debt management plan or individual voluntary arrnagement which does not involve borrowing more” Falla advised.
Despite these shocking statistics it appears that the Payday Loan companies themselves are applying their own brakes to their lending policies – perhaps knowing that an even bigger recession is not a complete impossibility. These companies now appear to decline over 90% of their applications, so it appears at least for the time being that many have nowhere to turn for cash to get them to their next payday at all.
Payday loans can be a great way for someone in the UK to have quick and convenient access to short term lending. These no credit check loans are not collateralized against any asset and are available to nearly anyone who can provide proof of regular income. Modern payday loans are available through numerous online payday loan lending websites, and can make it possible for even the most technologically challenged to find the financial support and quick source of cash that may be needed. The whole application process can be completed in no time at all, and can end up with the borrower receiving a quick payday advance without very much effort at all on their part.
Cash advance loans have been around for quite a while, and are by no means a fresh endeavor. They have been, however, rejuvenated as an industry as the business has moved away from going on in physical shops and moving quickly towards being an exclusively online marketplace. This is a perfect paradigm for such a useful financial tool as payday loans because it makes the loans available to a much wider demographic. It also decreases the amount of money that is needed for these shops to spend on marketing and sales, so that they can offer the loans at a lower rate. Why might these shops have any incentive to offer their loans at a lower rate? The answer is simple. As the business moves online there are fewer and fewer operation costs. That means that the profit margin increases, incenting more and more people to enter the payday loan game.
As more entrepreneurs enter the market, the profits will decrease as each lender undercuts each other to gain more business. As they do this, profits, and interest fees applicable to the loans, decrease, leaving the consumer of payday loans as the victor in the situation. Because the borrower is the one who wins in this case, people applying for cash advance loans can feel that much better about their decision to take on short term debt.
The component that may be most important to potential borrowers of short term credit through cash advance loans is that many do not require any credit check whatsoever. These no credit check loans make them perfect as bad credit loans. This is great because most people who have what regular creditors would consider “bad credit” have that title because of only a couple mess ups. These mess ups should by no means restrict a person from being able to gain access to some form of credit if they are in a time of need, or simply find themselves in a position where they can without a doubt handle the debt that they wish to take on. Thankfully, payday loans can offer this. The tradeoff for such people is that payday loans have a higher interest fee than you might find on credit cards or other forms of credit.
Most people are not all that aware that they can make today their payday by using payday loans. Payday loans are a type of financing that provides the borrower with quick cash today in exchange for a promise to repay the debt on their next paycheck, along with some interest. The best part is that payday loan interest rates seem to be on the decline as of late. The expansion of the payday loan industry to the online marketplace has greatly increased the number of players in the lending market, and has led to more competition between loan providers. This is good news for the average consumer of payday loans.
The average consumer of modern day payday loans can really be any type of person. There is no standard demographic when it comes to short term credit, because everyone could find themselves in a situation where they find themselves in urgent need of short term credit at some point in their lives.
Many people plan effectively with their money and set aside nest egg money or have a regular savings plan. This is not always the case though. There are many of people in all walks of life who find themselves without any sort of emergency kitty from which to dig from if some sort of shock were to occur to their finances. These people can often borrow money from friends or family, but with the world economy in the state that it is currently, there are often times where people may not have anyone from whom they can borrow from. In this case, a payday loan could be a lifesaver, bringing the much needed funds directly to your bank account in little to no time at all.
The process has changed considerably from how the whole industry used to operate in the past. What once was a hassle is now a convenient exercise in modern computing. Instead of letting one’s fingers do the walking through the local phone book yellow pages to try to find a source of quick cash, people can now let their fingers do the talking through online application forms, and let their eyes do the listening by allowing them to browse through all terms and conditions online from the comfort of their own home, in their favorite chair, in front of their television, while eating and watching Oprah reruns. What used to be such an out of the way affair is now simple as pie.
The savers are not the only ones who require payday loans occasionally. These loans may also be justifiably required by college students, young professionals, those who are in between jobs, and countless other cases. For these people, life does not have to consist of ramen noodles and potatoes any longer. They may be able to substitute these inconveniences and discomfort for the comfort and convenience of modern day payday loans. It is not a crime to live within your means, but occasionally a small or significant expense may arise unexpectedly. Consider a college student who finds they have a much higher cost for books and school supplies in a given semester; much higher than the usual required materials. One certainly should not sacrifice their education and risk future hardships when they could easily apply for and take out a payday loan instead.
Payday loan interest rates are admittedly higher than other forms of credit. This is a huge road block for many who are considering taking one out. But it is arguably cheaper to take out a payday loan today and avoid things such as bank fees. These fees go straight to the pockets of these huge banking institutions and are an open wound for your finances. They are usually caused by bank account or checking account overdrafts, and an range from a few quid to hundreds of pounds, depending on the situation. This is not to mention as well the ramifications from the people who had their payments rejected and their checks bounced. All of these things have a cost, and that cost can greatly overshadow the cost of interest on a payday loan. This goes back to comfort as well. Some find it greatly worth it to pay the cost of interest down the road to not have to dine on ramen noodles and potatoes today. Everyone’s preferences are obviously different, but the fact remains that these loans could benefit some greatly in a great range of scenarios.
The widespread criticism of short term credit seems to be based on the fact that some people tend to handle these loans irresponsibly. They absolutely seem like something that should not be abused. One should take great care and find out all of the information possible about their prospective lenders before making any borrowing decision. But the fact remains that they are incredibly useful for people in dire financial situations, and can occasionally be a lifesaver for those who are in need.
Those looking to learn more about payday loans should educate themselves online through a few different sources. A good place to start would likely be the individual lender websites. There are, however, many providers of payday loans and short term credit who operate online, so it may be helpful to visit a payday loan comparison website to get some basic information on the top lenders’ offers before searching the internet as a whole. The requirements for these loans usually specify that the borrower be over the age of 18, be a UK resident, and have some sort of proof of regular income. That may include regular pay stubs from your employer, or even bank records showing regular inflows of cash that could come from family, from a private business, or from any other dependable source that will illustrate one’s ability to eventually pay back their debt. It may be greatly advantageous for anyone to find out more about payday loans today, rather than waiting and wondering what life could be life with less financial stress.
Payday loans are a form of no credit check loan which means that even people with a very bad credit history may apply. This industry has completely exploded in the UK over this last couple of years and the concept has gone from being a little known operation linked to loan sharks to a fully blown mainstream financial product that most people have heard about. In fact if you ask friends and family there is good chance that someone you know has actually taken out a payday loan, or knows someone who has done so. Alongside this massive increase in demand has come a huge increase in supply which means there are plenty lenders to choose from nowadays compared to the small number of companies operating in the UK a few years ago.
The industry has been in the news a lot recently as some members of parliament, as well as some pressure groups, have been campaigning for greater regulation in the industry to curb things like excessive APR interest rates and repayment amounts. These groups feel that payday loans lenders take advantage of people in need of cash loans and charge them exorbitant APR interest rates because they know that they have no other options for borrowing fast money. There are not many loans for people with bad credit available in the UK so these companies are accused of using this to their advantage and charging ridiculous fees because they know they can get away with it.
However, a lot of the complaints are based on a misperception of the APR interest rate that these payday loans companies charge. APR is calculated over a year’s payment period (by definition: A = annual) But the main point about payday loans is that they are to be paid back after ONE month I.e. at the borrower’s next payday. When the APR is calculated it skews the number and makes it appear far, far higher than it really is if you were to pay back the loan after one month. This is of course a problem with statistics in general and not just this industry but by law they need to advertise their financial products with APR fully shown and explained to customers prior to purchase.
In the UK there are various lenders providing payday loans for people with bad credit, and they are becoming more popular every day. Most of these lenders will have no credit check done on the borrower as part of the application procedure. The reason for this is probably due to the fact that the loans are for small amounts at a time and they qualify borrowers first by making them prove that they have a regular income and can therefore make the repayments. They are also unsecured loans so people do not have to risk losing an asset if they cannot repay the money for whatever reason.
Nowadays there are quite a few lenders in the UK who specialise in very bad credit loans. As people with very bad credit know only too well, it is extremely difficult or actually even impossible to borrow money through the traditional channels. Obviously no one wants to go to a loan shark to borrow money due to the ridiculous interest rates and the “unconventional” methods of debt recovery. However, many people in the UK have been dragged into this world due to the reluctance of banks and lenders to give them credit at a time they desperately need money. This drives them into the hands of non regulated companies and individuals. Many people would have no problem paying back the money on a traditional loan it is just that the very bad credit record they have prevents them from borrowing money.
What people need is very bad credit loans which are a type of loan available from various logbook loans companies throughout the UK. If someone with very bad credit applies to one of these companies then they can be given an instant decision as to whether they qualify and they don’t even have to go through a credit check. No credit check loans are unusual but available across the UK in the form of logbook loans where a borrower will put the car against the loan as security so the borrower has less of a risk when lending to them. The basic issue at stake is the likelihood that they will pay back the loan installments or whether they will default on the loan, because for obvious reasons a lender wants to get the principle back plus interest. The function of a loans company is to lend money to people and make a profit through the interest payments – they take a risk up front by giving someone else their own money and trusting them to give it back plus APR interest. Individuals with a very bad credit history have shown in the past that they cannot be trusted to repay loans – this is the meaning of a credit record, and this is what the checks are done on in order to ascertain the trustworthiness of the person.
Some people with very bad credit are in this position due to mistakes made many years ago, or even through no fault of their own, for example the behavior of a spouse with a joint account. The problem with a very bad credit record is that it doesn’t just go away when your circumstances change, like getting a highly paid new job. So someone could potentially be in the position of being in a fairly well paid job but need extra money and cannot get a loan from traditional lenders in the UK, while someone else on a very low paid job but with a clean credit record can get money very easily. Unfortunately there is not a lot these folks can do about it at present other than find a finance company that will agree to lend to people with very bad credit. The flip side of this is that the APR interest rate will likely be a fair bit higher than the APR at your local bank. It needs to be taken into account that the fact that APR is worked out over a year’s repayment time and often logbook loans repayment periods are much shorter than this, for example even as low as a single month. When the monthly figures are put in other terms then the repayments can seem much more reasonable.
How many times have you had to ask a friend or family member for a loan until payday? It may be for a very real expense, or might be a simple case of wanting a good night out to celebrate a friends birthday. Either way you know that when payday comes you will have the money to cover this small extravagance or required expense.
It can prove very embarrassing to be constantly asking people you know and care about for small loans just to ensure you can afford your bus fares or a night out which is why payday loans are now offering their services.
Payday Loans are originally an American concept that proved so popular UK companies soon followed suit. In 2009 £1.2 billion was borrowed by UK employees from payday loan companies and other similar short term finance companies. With the number of people taking this form of loan quadrupling in only four years – The Guardian
While currently the loans are given by specialist short term finance companies it is hoped that in the near future these loans will also be offered by high street banks.
While many calls have been made to ban the loans, many users of the loans agree that they find the service offers them a certain amount of comfort. While many have people they can rely on to borrow small amounts of money, many do not. While repeatedly taking a payday loan should never be advised it can provide a certain amount of comfort knowing that this finance would be available if required and in emergency circumstances.
People have quoted a number of reasons why they have applied and from these it is easy to understand how a loan until payday may have helped, if not resolved what may have otherwise been an unmanageable situation.
Some reasons given for taking a payday loan.
Broken Down Washing Machine, Vehicle Repairs, Replacing Stolen Money, Unexpected travel expense to attend a funeral, Potential bank charge of £35.
Whether a payday loan is right for you or not I think they will be around for sometime to come. The only advise worth giving is only borrow what you can comfortably afford to pay back. The comfort of knowing it is available should it be required may be all you need to sleep easier tonight.
