*Dealing with an unexpected rainy day

We’ve all been there, right? You think things are going well for you, you’ve paid your overdraft off (and if you’re with the same bank as me, that means you’re not allowed one anymore-though you weren’t over your limit or doing anything you shouldn’t have been) and you may even have £100 or so in your savings. Then the car breaks down, and you’re screwed. Enter…payday loans.

Now, there’s a perception that payday loans are terrible, they charge huge amounts of interest and are to be AVOIDED AT ALL COSTS. And when I was asked to work with CashLady to talk about their Payday loans I was a little bit apprehensive. I don’t ever want to tell you guys about something that I don’t agree with. Luckily, when I had a little nosy on their website, I’ve changed my mind somewhat.

CashLady is a broker, which means they don’t lend you money themselves, they deal with 15 other companies who do. Their website has lots and lots of information about payday loans (now not a 30 day term, since a change to financial regulations they tend to be paid back over 2 or 3 months instead-with most lenders not charging an early repayment fee should you wish to pay them back sooner) and I was really impressed by the fact they have an affordability calculator, which helps you to work out if you can afford to pay back the loan based on your monthly outgoings.

I’ve used payday loans myself in the past, and got into the habit of borrowing a little more each month, paying it back and then borrowing a higher amount next month. This did not end well, obviously. I did get out of the cycle by having a month where I spent nothing at all apart from my petrol to and from work, so that I could pay off a big chunk of the loan. I then borrowed a far smaller amount the month after and after a couple of months was back to not needing one. These days, I wouldn’t be able to keep borrowing like that, the new regulations mean I’d most likely be refused-which is great.

As a short term, one off solution, a payday loan isn’t, in my opinion, a bad option. If you GENUINELY need the money (and be honest with yourself, a holiday is not a genuine emergency, but your car tyre exploding is) and you KNOW you can make the payment without any financial problems over the next couple of months-then do it. Just be careful, as with any form of credit.

Have you had a payday loan experience? I’d love to hear about it in the comments.

*I have been paid to write this post. As with all content on Inside Laura’s Head, the words and opinions are all my own.

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