Pay day loan
A small loan agreed on the basis of monthly earnings and which is to be repaid within a 31 day period.
Bad credit history
Many people in our society have obtained a bad credit history, either by having endured bankruptcy or by being in arrears with a loan from another provider. Thankfully, pay day loan companies will often lend to those with bad credit histories.
A loan calculator is an online tool for figuring out the total amount you will repay on your loan as well as the average installments you will be paying, on the basis of the amount you are loaning alongside the interest rate.
APR (annual percentage rate)
This is the standard way of quoting interest to a client, even when the loan term is less than a year. It is the amount, as a percentage, that you would pay to a creditor if you loaned a sum of money for a year.
Interest is the basic term for the percentage of the sum loaned that you pay to the lender on top of paying him back. Paying interest allows the creditor to continue to provide loans as a service.
Some loan providers will expect you to pledge an asset that you own against your loan. This asset will be claimed by your creditor if you are unable to repay the loan. Common assets used for collateral include houses and cars.
An unsecured loan is one which is loaned without the creditor having any collateral. All pay day loans are unsecured loans meaning that they are easier to obtain for those who do not possess valuable assets including the many people who do not own their own home.
A creditor is a person or organization who loans you money, usually at a pre-agreed interest rate. By law creditors have to be certified by the US government in order to operate legally.
The debtor is you, the person who takes out the loan. On this website the word “customer” tends to be preferred, but they mean the same the thing in this context.
Before taking out any sort of loan it is important to budget. This means making sure that your total monthly income exceeds your outgoings so that you will be able to pay off the amount of money that you are loaning.
Total repayment amount
This is the total amount that you will pay to your creditor in order to fulfil the terms of the loan agreed. It is important to remember that this amount is different than the amount you originally loan as you will need to add on interest and any additional charges you have incurred.
The term of your loan is the length of time you will be given to repay it. With a pay day loan this is always 31 days or less. Installments Loans are typically repaid in installments. This means that the total repayment amount is broken up into sections to be repaid more manageably, one at a time.