Is a Credit Check Always Required for a Payday Loan?

Often it is those who find it most difficult to receive loans that are those most in need of one. Those who have been lucky enough to find stable, well-paying employment and have never had difficulty in paying back a loan or an unexpected expense that throws their household budget into havoc are most sought after by banks and other conventional lending institutions. However, their salaries and savings mean that they do not often need to apply for a loan. Those who need to take out loans due to low or irregular incomes or the day-to-day expenses caused by cheap unreliable cars and household appliances find it much more difficult to receive credit. Often their credit histories make banks and other lenders wary of offering them a loan, especially in today's risk-averse economic climate. Those who previously were acceptable to banks may now find that changing lending criteria mean that their credit history is no longer acceptable.

Quick easy credit is more important now than ever before. With so many companies laying off staff and reducing hours, families can find their budget squeezed or one partner supporting a family that used to get by on two incomes. Families are putting off home maintenance and car repairs in order to meet more immediate expenses, all of which can lead to the sudden need for a loan if something breaks. This is ignoring all the usual little emergencies like dental work and interview clothes that families may no longer have the savings to be able to cover without going into debt.

Payday loans can be a life-saver for those whose credit history does not allow them to qualify for a conventional loan. While some payday loan providers will run a credit check, many others do not require any. The basic requirements for a payday loan are simple. You must be over the age of 18, a resident of the United Kingdom and be employed. Part-time, full-time, contract and temporary employment are all perfectly fine, as long as your pay is deposited into a bank account for which you have a debit card. The reason for this requirement is so that your loan can be paid back via your debit card when your next pay cheque is deposited. It is this system that allows payday loan providers to approve you for a loan without a credit cheque - the repayment process is automated and the full amount of the loan and charges is deducted when your pay is deposited.

Payday loan providers will show you the cost of your loan both as an annual percentage rate (APR) and usually the cost per £100 that has been loaned. This makes it easy to see exactly how much you can afford and how much you will have left of your pay cheque once you have paid back the loan. In cases where you are unexpectedly unable to pay back the loan, your payday loan provider may allow you to defer the repayment to your next payday, but this will likely incur additional charges. You should be sure to only borrow what you can afford to pay back.

Payday loans are quick and easy. Many providers allow you to complete the entire application process online, with no need to fax documents or anything similar. Filling out and submitting the form and receiving approval can take as short a time as five minutes. In some cases, the full amount of your loan can be deposited in your bank account within the hour, even on a Saturday. Some banks may however take up to 48 hours to process the payment.

Vincent Rogers is a finance writer who writes for a number of UK businesses. For 1 hour payday loans, he recommends Paydayplus.co.uk