If you are in need of a small loan fast and go online to search, it’s easy to get bogged down by the ever growing amount of options that appear in your results. Trying to decipher which one is best for your situation can take valuable time you don’t have if you need to make a decision quickly.
We’ve put together a guide to tell you how to choose the best emergency finance option so you can find the right option to suit you.
Knowing the company you are loaning money from is credible is the most important thing to check before going any further. They should be regulated by the Financial Conduct Authority (FCA) and you can use their website to check if the company is registered. If they are registered, it means they must follow UK laws that are designed to protect to you as a customer. Do not accept any excuse for the company not being registered with the FCA. Should you not be able to find them on their website, look for another company to use instead.Also look at sites like Smart Money People, which aggregates customer reviews for financial based companies.
Verify the website
Being registered with the FCA is a fundamental starting point. However, you should also check the company’s website to ensure it is still a genuine business. Look at the bottom of the home page for their company registration number and FCA licence number. If they have won awards related to their industry this shows they are a respected company. They should also have a contactable phone number and a working email address.
When you take out an emergency loan you must remember you won’t just be paying back the same amount you have borrowed. There will be interest added to the repayments, so take time looking at the ‘APR’ rate to fully understand how much you will owe the lender. Also bear in mind that when the loan is advertise. The interest rate is likely to be based on an average figure. The rate you will receive depends on a number of different factors, including the type of emergency finance you are taking out and your credit history.
The whole point of an emergency loan is you need the money as soon as possible to get you out of a tricky situation. Some lenders can take up to 3 days to process an application. Which will probably not be of any use to you. There are some alternatives that will give you an answer within the same day and provide the funds to your account. They may even offer the service on weekends. Don’t just take any loan you can find just because it can be give to you quickly. Although time is an important factor to consider.
No matter how much of an emergency it is, you should also take a little time to compare the deals you are looking at. The internet makes it easy to hit the search button, land on the first page you see and accept the deal they are offering. But comparing the deals on offer shouldn’t take up too much of your time. Compare the approval times, repayment plans and interest rates to see. Which one strikes the right balance for your current situation before making a decision.