In the winter before Christmas, it is common for the demand for payday loans to increase, so that people are able to cover the cost of Christmas preparations, decorations and gifts. Christmas is considered a magical time, but it is associated with many hour-long preparations and gift purchases. That’s why many people are a time they can’t overcome without financial help. But if you’re trying to find out if your payday loan is worth it, you shouldn’t just look at the interest rate.
And now we can move on to things that need to be checked before applying for a payday loan:
1. You really need it
According to the financial portal, there is a surprising number of people asking for a payday loan without needing it. Either they receive the offer by email or see the ad, and are already wondering what they could use for the money. On the contrary, the initiative and the request should always come from people and only when necessary.
2. What is the provider’s reputation?
When comparing different offers, focus on where they are from. Browse his website to find out what people are saying about him in reviews. If you want to be sure of its credibility, see the Czech National Bank’s online database to see if it has a valid license.
3. Will you be able to repay?
Many people automatically assume that they will be able to repay the payday loan without any problems. But the responsible consumer should create a budget and see how much he has left after deducting his expenses. This is the maximum monthly payment. Only in this way will you find out whether the payday loan repayment will be comfortable for you or if there are unpredictable problems.
4. What are the real costs of the payday loan?
When trying to uncover the true cost of a payday loan, don’t just look at the interest rate. You should consider additional charges, but also benefits. The universal tool for comparing the advantage of payday loans is the APRC. Includes interest rate and all other charges. For example, early repayment of a payday loan with no fees or the possibility of extending its maturity when one month’s installment fails can be advantages.
5. What happens if you can’t pay back?
While this is an unpleasant idea, you should also take into account that due to an unexpected situation you will not be able to repay the payday loan. If this happens, it will be better to know what awaits you and what you can do. You will be charged a delay and interest charge for each day in arrears. These terms must always be mentioned in the contract. That is why it is always worthwhile to read the contract for a time with the choice of payday loan. You can avoid execution or personal bankruptcy.