There are many loans which only have a specific purpose. For example, a student loan can only be used by students to pay for their course and living expenses. However, there are also many loans which do not have a specific purpose. Payday loans fit into this category as you do not need to use them for buying specific things. However, It is important to still make sure that the purpose you need the money for is a good one.
Should I Borrow at all?
It is a good idea to start by thinking about whether borrowing is the right idea. Consider whether you can borrow, what loan options you have and whether you think it is the right solution to your problem. If you have savings, for example, it is probably better to use those than borrow money. This is because all borrowing costs money and if you use savings then you will not have to pay this. You will miss out on interest on your savings, but that will usually be less than you are paying in interest on the loan. It is worth checking but usually savings interest is significantly less than charges on loans.
You should also think about whether you really need the money that you are borrowing. Of course, if you are buying food then it could be really necessary. However, make sure that there are not ways you can cut back elsewhere so that you can more easily afford the food. Also make sure that you really need it, that you don’t have some food that you can use even if you do not like it so much, perhaps some tins in the cupboard or things in the freezer. You may be able to buy cheaper food too, which could mean that you will not need to borrow to afford it.
Can I Borrow Enough?
It is also good to make sure that you will be able to borrow enough money from a site such as Boutell.co.uk to pay for the food that you need. With a payday loan you can borrow between £100 and £1,000 as a rule, but different lenders will have different amounts that they will lend. You may also find that payday lenders will want to be cautious when they lend to borrowers for the first time. It is a risk and so they may be keen to make sure that they will be able to trust the borrower. This means that they may only let them borrow a small amount to start with and this amount may not be enough to cover the cost of the food.
Can I Repay?
It is also a good idea to think about repayment. Obviously, you do not want to starve and so you really will need to borrow the money if you have no other way to buy food and eat. However, it is important to make sure that you know how you should be repaying it. With a payday loan you have to repay in a lump sum on the next day that you are paid. This means that you need to be sure that you are able to afford to do this. Of course, if you are being paid, then you will have money available to you. You may therefore feel that it is unnecessary to worry about it, but you should check carefully. Remember that you will have other things to pay for as well and therefore you will need to make sure that you have enough money for that as well. It might be that you will have a lot of things going out that day and you need to make sure that there will be enough to cover it all. You also need to think about the other things that you will also need to buy during the course of the month and whether you will have enough to cover those as well.
If you are not able to repay, you will be charged extra money. This is what will happen with any loan that you take out and miss a repayment for and so you need to be careful. No one will want to pay out more than necessary.
Do I Have Alternatives?
It is a good idea to also think about whether there are any alternative solutions which might work better for you. This will very much depend on your own personal circumstances. It might be that you will be able to take out different types of loans perhaps. It might also be that you will be able to fund things in a different way. Perhaps you will be able to reduce your spending in different areas, or earn more money somehow or sell things to raise some money. It is worth thinking about whether you might be able to do anything else or whether perhaps, even if you do borrow, whether you can do any of these to help it to be easier for you to repay the loan or manage you finances once it is repaid.
