How to Easily Calculate the Total Cost of Your Short Term Loan
Short term loans or payday loans are the things for you if you need to pay off something in a hurry or if there is a certain crisis. Whether it is some medical bills that you need to clear or the huge debt that you might have acquired by going on a vacation, short term loans are great for you. The great thing about these loans is that they are very easy to acquire. The paperwork is relatively simple, scrutiny is not too stringent and you get the cash in your hands within 24-48 hours.
Another great thing about payday loans is that you can even get them online. No more will you have to get in the hassle of looking for a credible lender whom you can trust. Search up a reliable lender online, fill out a simple form, give your credit score and you have the money in your hand. They are called payday because you get to pay them off on your next payday. The duration of the loan varies from lender to lender and could be as short as a week or as long as a month. The amount you can lend also varies but the highest that you can get at a certain time is around £1000.
What you need to keep in mind is that the loan that you end up paying is not just the money that you borrow, but also the interest that you will need to pay on it, as well as hidden charges that might be attached to it. These amounts can be confusing and can lead to difficulty understanding the total cost that you will ultimately have to pay back. This is the reason it’s best you have at least a general idea of how you can calculate these costs.
As mentioned above, there are always some kind of additional charges that are attached to the loan that you apply for, be it long term or short term. This includes the interest over the amount that you take, along with the time duration in which you pay it off. Some other hidden charges include fees of the lender, commission etc. Even though there are online calculators available on most websites, you would not be able to find out the whole cost until and unless you go through the policies, rules and regulations of the lender.
Calculating the Overall Costs
Therefore, before trying to use the online calculators, the first thing that you must do is read up on the policies and rules very carefully. Once that is done and you are informed about all hidden charges, calculate the total cost of your short term loans by adding interest to the amount you need, as well as any other applicable charges.
If for example, you want a loan of £450 for 30 days, the interest being 330 and no other additional charges, the overall amount you will need to pay will be £573.75 and the interest would be £123.75. But this is only an estimate because the real value can only be discovered once you know what the lender is charging.
Keep in mind that if you somehow delay the payment, the interest rate and overall charges would increase. Therefore, try to pay within the predetermined time.