Back To University Student Payday Loans
September marks the start of the university term for many UK students. A number of them will return from a full summer of working hard in order to come back to university with as much personal savings as possible as a financial cushion to help them throughout the year. The majority of UK students will rely on student loans and funding in order to help them through their academic years. Student loans are used for a number of things, from paying university course fees, rent and accommodation and evenly weekly food bills.
However with the steep increase in university fees and accommodation costs, many students are having to dip into their own personal savings accounts in order to cover costs that would previously have been covered by their student loans. Not only are students having to use their own personal savings but are also turning to alternative methods of finance such as payday loans.
It’s estimated that 1 in 3 students have applied for a payday loan for reasons such as accommodation costs, weekly food bills and more alarmingly for the occasional night out. With more students struggling to combine a working life with their studies and due to the increase in competition for each job whilst at university, more and more students are opting for short term finance providers in a bid to help them cover monthly costs.
Students based in London City are more likely to apply for additional finances as a result of higher university fees and a higher cost of living. Manchester was a close second with Loughborough coming in third place
What other loans can students get?
As well as your traditional student loan that is repaid over a long term, most typically over a 30 year period until it is wiped off. Students can also turn to a number of other alternatives. There are a number of different types of loans that are available to students on a more short term basis. Many students throughout the UK are faced with cash-flow issues because of the rising costs of student accommodation and the general daily costs to survive which include getting to and from your course as well as food consumption. In recent years, there have been a growing number of students that have turned to payday loans and other short term loans in order to help with the rising costs of attending a UK university.
Small Loans For Students
Payday loans have been a very popular conception with Students based on the very quick process and short borrowing terms available with them. Unlike personal loans provided by many larger banks and building societies, students do not have to go through a lengthy application process so will therefore borrow as and when they need to.
Early in 2014 the government introduced the new university fee structure which permitted UK based universities to charge a maximum yearly fee of £9000. More than 50% of universities do currently charge the maximum threshold however with the new repayment structure in place, this enables graduates to only start paying back the debt when they earn over £25,000 annually. However with university fees alone costing up to £9,000 students will have to borrow considerably more than that in order to help cover accommodation and weekly living costs.
There is no doubting that payday loans are very popular with students, with people aged 18-25 more likely to take out a payday loan than any other age range. Approximately 30% of the 18-25 age category are currently students throughout the UK. The debate of whether university fees are too high has divided the government with many people sharing different opinions on what the realistic price should be to study at a UK university. Many have argued that with the increase in fees and living
For students that are looking to take out a larger sized personal loan, within the region of £2,000, the lender you are applying with may insist on a guarantor. However for smaller student payday loans no guarantor is required.
Short term Loans For Students
Unlike your traditional student loan, a short term loan is usually smaller in value and will typically be repaid in equal payments. For example if you take out a loan over 6 months, you will be required to repay the loan in 6 monthly repayments.
There are many direct lenders who offer short term loans for students who may not have a credit history. The majority of students will not have an adequate credit history as they have not yet started their working life and paid bills. However, with that said; some lenders will offer loans to students based on the fact that they may not have a full credit file.
Do all UK Direct Lenders offer loans for students?
Payday pixie compare many different lenders and match customer with the lender that can best meet their financial needs. For example, if you are applying with one lender and one lender only you are relying solely on that direct lender giving you a decision. With pixie loans we show your application to a whole host of lenders, improving you chances of getting accepted!
The majority of UK lenders may have an option for UK students, although the majority of students do not have a stable source of income which may mean that a number of lenders may reject your application.
What if i have a bad credit history?
The majority of students have only just entered their adult and working life, and many of them have never even taken out a loan or any other form of finance before. What this means is most students would not have a valid credit history due to the fact that they have not borrowed before. UK Student loan lenders by law have to carry out a credit history check to validate whether an individual has any outstanding debts or may struggle to repay the full cost of their loan.
Loans that require no credit check are specifically suited for individuals with no credit history or a bad credit history which can make them a suitable fit for some students. Although the majority of lenders will perform a credit history check, this is mainly to look for bad marks against an individuals credit file such as insolvency or bankruptcy, a lender will be able to tell if an individual has never taken out any form of finance before. However, the majority of lenders will not decline your loan application due tot he fact that you do not have a credit history, they will look at other aspects such as your employment status, monthly earnings and outgoings to asses your affordability.