Payday Loan Online News

simplepayday.co.uk Recently many payday lenders have been talking about their commitment to responsible borrowing. But what does that really mean and what does it commit the pay day lender to? What is responsible borrowing? The Consumer Credit Act laid down some guidelines for the payday lender and the industry has developed some for themselves. Some of the things included in these documents are: Pre loan information to borrower to produce informed consent. Commitment to only lend to people if comfortable they can repay the loan. Explain the risks of pay day loan and exactly what it will cost Advertisements and online website must display APR (Annual Percentage Rate of Interest). Website must have a real life example of the finance charges and APR. These are the most important aspects of a responsible borrowing policy. In real life they mean that the payday loans lender must give the borrower all the terms of the agreement in plain English and in writing prior to the signing of a contract. It means that even though most pay day lenders do not check credit ratings they do base their loan decisions and the amount they will loan to any borrower on the amount the borrower receives in their pay check. The pay day lender will not approve someone whose pay check is for 600 pounds for a loan of 600 pounds. That would not be responsible borrowing since it is highly unlikely that the borrower could pay it back on time. It would be responsible to limit this borrower’s loan amount to …

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