Within the online marketing for borrowing small loans there are two specific types of lenders who exist. These are known commonly as the direct lenders and the loan brokers. The difference between these two providers of small loans can mean a difference in the total amount payable.

2. Withinthe online marketing for borrowing small loans there are two specific types of lenders who exist.
Theseare known commonly as the direct lenders and the loanbrokers. The difference between thesetwo
providers of small loans can meana difference in the total amount payable. That said it would be fair to
say that bothof these providers offer a service whichcan serve the needs of consumers. So in order to
understand the direct lenders and loan brokers a bit better, lets dive deeper intowhat it is each of them
offer whenit comes to short termloans.

3. As most of us will already be aware, short term
loans or payday loans as they are also known, allow
us the ability to borrow a small sum of money,
usually no more than £500.00 in value. The loans
themselves are accessible via the completion of an
online based application form and in doing so we
are usually offered a range of flexible repayment
terms.

4. Depending on our own individual needs this can mean repayments over a few months or several. Generally, a bit
of research will reveal the ability to repay over 2 months or 6 months for example. All payday loan lenders
whether they be direct lenders or loan brokers, are now regulated by the FCA who are the Financial Conduct
Authority. It is the job of the FCA to regulate and monitor the activities of all lenders who offer these type of
loans.

5. Payday Loan Lenders and How to Afford their Loans

6. So back to the case in pointthen, what is the
difference between direct lenders and the loan
brokers of payday loans and why is there a likely
difference in the overall cost of borrowing
depending on the selection made? Firstly, we will
look at the direct lenders of these loans. A direct
lender, as the namesuggests offers theabilityfor
us to applywitha specificlender and therefore
‘directly’. Whenwe complete the application
online, the lender withwhomwe submittedour
details will makean informed decisionas to the
suitably of our loan request.

8. When this decision has been made, this same lender will deliver the outcome and if successful, will be the
one to deliver the loan to our account. In instances where the loan application is deemed unsuccessful
direct lenders will not charge a fee simply for the service of considering your application.

10. So what does a broker do differently to the
service offered by direct lenders? In simple
terms it is actually very similar but there are
fundamental differences to consider. A broker
will consider the information provided in the
application and then will attempt to locate a
lender who may be able to help with our
request. They will make a recommendation to us
as to a potential lender based not only on our
needs but also the lenders with whom they have
an existing relationship with.

11. This means by using the service of a broker you are not
dealing with the lender directly in the first instance and
furthermore, a broker cannot promise the outcome of the
application will be a success. The main point here is that
brokers charge a fee for the service of simply looking for a
potential lender.

12. Pacific-Odyssey.CO.UK