Brits facing a ‘Christmas debt hangover’ after the festive season are considering turning to short term loans in increasing numbers, industry experts recently reported.
There are many benefits to taking out no credit check loans from a payday lender if you find yourself temporarily short on cash. Short term loans are especially designed to help get you through the financial doldrums until your next pay cheque, provided you can afford the small fee.
However, financial experts warn that you need to make sure you have the ability to repay the loan at the end of the term, as interest payments can rise quickly for borrowers who neglect to repay on schedule. This warning has hopefully been heeded by those taking out short term loans in the run-up to the festive season, as the number of Brits applying for the loans increased by a factor of four in comparison to November’s figures.
One payday advance lending industry leader remarked that the lion’s share of its applicants are between 18 to 35 years of age. Women seen to be more likely to apply than men, with more than three out of five of the lender’s customers being reported as female.
However, some borrowers may be using short term loans not to pay for essentials in financial emergencies but instead to finance things like nights out or shopping trips, according to the Debt Advice Foundation. According to the industry body, 10 per cent of payday borrowers say that borrow not to meet needs but for things they wanted instead.