Borrowing money entails responsibilities which you should make sure to meet unless you want your credit score or your overall financial health to suffer. Like any responsible borrower, one of the first things to look at real close is the cost of the loan. For the case of no guarantor loans, the average APR is somewhere at 300%.
To illustrate, let's say you want to borrow £500 to pay for overdue bills or for car repair. You plan to pay off the loan for 12 months via debit card. If the interest rate per annum is at 140% and the Representative APR of the loans is 278%, you'd end up paying off £79.09 per month or a total of £949.01 for 12 months. The total interest you have to pay, in other words, is about £449 which is almost what you borrowed in the first place.
Based on the example above, itís clear that no guarantor loans can be quite costly in the long run. Compared with payday loans with APR at 1,000%, however, the former option is still a winner. Either way, caution and careful planning should be observed with borrowing money to avoid damaging financial consequences. As a simple rule to abide, only opt for a no guarantor loan if youíve exhausted alternatives and you have no other choice left.