You’ll find various types of lenders online, so understanding the differences between UK direct lenders and credit brokers will ensure you know what to expect.
A direct lender (like us) provides the funds themselves and handles the entire lending process, from reviewing your application to sending the funds, and setting up repayments. A loan or credit broker, on the other hand, acts as a middleman. They collect your information and share it with one or more third-party lenders to try to find a suitable loan offer for you.
| Feature | Direct Lender | Loan Broker |
| Who provides the funds? | The lender provides the loan directly to the borrower. | Funds come from a third-party lender. |
| Application process | The application is assessed directly by the lender. | The application may be sent to multiple lenders. |
| Fees | Typically no broker involvement, meaning no fees. | Some brokers may receive referral commissions, charging a fee. |
| Control | Full control over lending decisions and repayments. | A broker acts as an intermediary between borrower and lender. |
In terms of having a quick online process, using a credit broker adds extra steps to your application, as they first have to find you a match from your initial application. Once they do, you will then go to the third party’s website to continue the application before getting approval and the cash.
This isn’t necessary with a loan direct lender, as your application is handled by them from the start, speeding up the time it takes to get a decision and receive the money you need. At Fast Loan UK, if the whole process runs smoothly, you can start your application, get approval and receive the cash after signing within 20 minutes overall.
How Direct Lender Loans Work at Fast Loan UK
We’ve created a streamlined application process for direct lender loans that makes it easy to apply today and won’t take up too much of your time. Here’s what you can expect when clicking apply now:
- Choose your loan amount: start by selecting the amount you would like to borrow and the repayment term that suits your budget.
- Submitan online application: complete our short application form with details about your income, employment, and financial situation.
- Affordability checks:we’ll review your application and perform affordability and creditworthiness checks to ensure the loan is suitable for your circumstances.
- Receive a decision: once the checks are complete, you will receive a decision on your applicationand your digital loan agreement to sign.
- Same DayFunds transfer: if approved and you accept the loan agreement, the funds are transferred directly to your bank account. You should receive this within 15 minutes of signing if your bank supports Faster Payments.
- Instalment repayments:we’llset up a Continuous Payment Authority (CPA) on your bank account to automatically take repayments each month. Simply ensure enough funds are cleared at least the day before each due date.
What Types of Loans Are Available from Direct Lenders?
There are a few different types of loans from direct lenders to be aware of, but each provides quick access to cash when you need it. The repayment structure and terms may vary, so it is important to consider each type before applying when comparing lenders.
Short Term Loans
A short term loan allows you to borrow a small amount to cover a short-term financial issue or urgent expense. They are provided by direct lenders to give you manageable repayments over a few weeks or months based on what you can afford to pay. Many people choose these for things like urgent household bills, including repairs, covering car breakdowns, or other types of urgent expenses that can’t wait until payday.
Payday Loans
A payday loan direct lender can help you with short-term cash that can be repaid on your next salary date, typically within 30 days. Traditionally, payday loans provided quick access to money but with more restricted repayment terms, so they wouldn’t be ideal for those needing longer than a month to repay. Due to the quick repayment in full needed, they are only recommended for emergency use and for smaller loan amounts.
Instalment Loans
A short-term direct lender can provide instalment loans to give you a longer repayment term over several months, typically up to a year. These can ensure you have smaller monthly repayments that fit your budget and can be sustained, rather than repaying the full balance in one go. These can be ideal for larger loan amounts of a few hundred pounds or more, where a shorter repayment term would be unaffordable.
Small Emergency Loans
Another type of short-term cash loan are emergency loans, where you are looking to borrow money quickly to cover unexpected expenses or an emergency situation that simply won’t wait. An instant decision direct lender can offer emergency cash for all types of urgent expenses, such as a boiler failure that needs immediate attention, emergency car or home expenses, bills, and more.
Are Direct Lenders Safe in the UK?
A UK direct lender must be authorised by the FCA to ensure you are treated fairly as a customer. When comparing lenders online, it’s crucial to only use those that you can easily find on the FCA register who follow responsible lending guidelines. Fast Loan UK are an FCA-regulated direct lender, and our reference number is 673907.
We know how important trust is for customers before completing an application and handing over personal details. We also know you need a loan that has been fairly assessed and will not cause you financial difficulties or charge you unnecessarily. That’s why we follow strict guidelines set out by the FCA that help to protect you as a borrower. You will receive clear, transparent terms of the total cost of borrowing, including the APR, so that you can make an informed decision.
The FCA introduced a price cap in 2015 to help protect borrowers, and at Fast Loan UK, you can trust that these guidelines are being followed:
- Interest and fees charged must not exceed 0.8% per day of the amount borrowed.
- Default fees must not exceed £15.
- Total cost cap of 100% of the amount borrowed, so that you never have to pay back more in fees and interest than the original amount.
You also have extra protection if problems arise when using direct lender payday loans in the UK. It’s always recommended to raise any issues or complaints you have directly with a lender first, and if the issue is not resolved, then take this further to the Financial Ombudsman Service.
Borrowing Responsibly with Direct Lender Loans
Before starting your application, you should consider the following so that you are borrowing for the right reasons and not overextending your finances:
- Borrow only what you need: taking a smaller loan amount can make repayments easier to manage rather than applying for the maximum amount available.
- Check the repayment schedule carefully: make sure that you understand when payments are due and how much you will need to repay. The total cost of the loan, including interest, will be presented to you before signing your agreement, so it’s a good idea to review this carefully.
- Consider alternative options first: in some cases, options such as using your savings, agreeing on a payment plan with who your urgent expense is with, or seeking support from family may be more suitable. Further borrowing should always be the last option after considering what else you can do to resolve your situation.
- Remember that short term loans are not long-term solutions: they are typically designed to help cover urgent or temporary financial needs rather than ongoing expenses. You want to avoid getting into a debt cycle where you rely on borrowing to help cover long-term financial issues.
With any form of finance, taking the time to review your situation first and looking at the bigger picture can help you make a more informed decision. You can find free debt advice and guidance with all money-related issues by using Money Helper, as well as organisations such as Citizens Advice, whenever you need further help.
Apply Today for a Direct Lender Loan
With affordable repayments to match your budget, a quick online decision process, and same day cash where this is possible, direct lender loans can help you when you need them. To start an application at Fast Loan UK, simply click apply now, and we’ll see what we can do today.
If you have any questions before you apply for a direct lender loan in the UK, please get in touch with our Customer Support Team. They are here to help you with anything you need.
