Payday loans: what happens if you make a late payment?

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When you need money urgently, a payday loan is certainly an option. A lot of people in the UK opt for payday loans because they can get these loans more easily and quickly compared to traditional loans from financial institutions. When they get their salary, they can repay the loan amount.

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Are you allowed to repay earlier?

Yes, you can repay earlier. All you have to do is inform your payday lender of your plans to pay early. Repaying early will save you money as you will only pay interest on the time that you had the loan for.

What happens if you repay the loan late?

One thing you should know about payday loans is that the companies make their profit from the interest rates they charge. If you find that you can’t repay the loan on the date agreed upon, you must speak to the lender and explain your situation.

However, if you ignore the lender, they may add a penalty charge of up to £15 in addition to adding interest that you will have to pay. You can avoid this by calling the payday loan lender and explaining your circumstances. Usually, reputable payday loan lenders are quite accommodating and will give you extra time to repay the loan amount without levying additional charges. However, you must ensure that you pay them back on time, otherwise they will add other fees and charges to your overall amount.

Before taking a payday loan, it helps to do some research. The allthelenders website is the best place to start your research. It is the UK’s first price comparison website for short-term loans, and the site is authorised and regulated by the FCA. You can rest assured knowing that the allthelenders website always provides 100% independent and accurate comparison results to help you make the right decision.