When we are looking for a loan, we may wonder whether we are allowed to use it for certain purposes. This is not surprising as there are some loans which are designed to have certain uses. For example, a mortgage is designed for buying a home and you would not use it for anything else. However, there are a lot of loans which do not have specific purposes and therefore you can use them for anything you wish A no credit check payday loan falls into this category. However, it may still not be the right loan to pay rent. It is worth thinking about whether it will work for you.
Can I borrow enough?
It is important to start by checking whether you can borrow enough money to cover the cost of your rent. Payday lenders will tend to lend up to £1,000 and this might be enough to cover many rents. Obviously, this will very much depend on where you live and how big your house is. It is also worth knowing that some lenders will not always lend larger amounts to borrowers that have not borrowed with them before. This is because they will want to build up some trust first. As they do not look at a borrower’s credit score, then they will need to build up trust in a different way. This mean that they will ask a borrower to just borrow and small amount and then when they have repaid it on time, they will feel that they can trust them more and that will enable them to feel happier to lend them more money. Some lenders will only lend a few hundred pounds initially and this could mean that it will not be enough to cover rent. However, lenders will vary in this and so it may be a case of comparing them until you find one that will offer the amount of money that you need.
Can I repay it?
It is also extremely sensible to make sure that you can repay the loan. A payday loan has to be repaid in full, with the interest and fees on your next payday. This means that you will have to find the money that you need to repay it very quickly. Of course, as the repayment falls on your payday, this means that you should have enough money available to repay. However, you may have to make sure that you have enough to pay anything else that has to be paid on that day only as well as at other times. You may have to pay another instalment of rent, for example and therefore need enough money left for that. It can therefore be sensible to make sure that you have enough money, by looking at you last few bank statements and working out what payments you will have to make and whether you will have enough money after repaying the loan. If you feel that you will not, then you will need think of some ideas. You may have to not get the loan at all or you might be able to think of some ways that you can earn more money or spend less so that you will be able to afford it. It is worth coming up with some realistic plans so that you can ensure you will be guaranteed to be able to afford everything you need to pay for.
Am I happy with the cost?
Lastly, you should think about whether you are happy with the cost of the loan. You should be able to work out the cost quite easily. Often a lender will have a calculator on their website where you will be able to out in the details of how much you need to borrow and how long for and it will let you know the amount you will need to repay. If you take away the amount that you borrowed, then you will be able to work out the cost. You then need to consider whether it is worth paying that much more. Of course, if you miss the rent payment there will be consequences. It can be well worth finding out what those consequences will be. Talk to your landlord or letting agency and explain that you are struggling and what will happen and they will let you know. Otherwise it will be in your rental agreement if you have that handy. It might be that you will need to pay extra interest or some fees or charges and if this is the case you will need to compare this to the cost of the loan and work out which will be cheaper. You might be evicted, if this is the case then it is very likely that you will think the costs are worth it!