What are Personal Loans?
A personal loan is typically borrowed from your bank or through a shop where you are buying an expensive item. You can agree to pay back personal loans over a fixed term by making set monthly payments.
There may be an arrangement fee when you take out a personal loan.
Personal loans are a safer alternative to credit cards, the interest rate will be cheaper
What is a secured loan?
If you are a homeowner and need some finances , then the secured personal loan is for you. It risk for the borrower, as your property is put up as collateral.
Secured loans? Beware!!
If you are thinking of getting a secured loan you should be reluctant to if..
- you have debt problems,. taking on more debt to clear an existing debt may not be a good idea as your home may be at risk.
- You are Unemployed
- Self Employed, having periods of high and low income may put your home at risk
What are Unsecured Loans?
If you’re not a home owner, or don’t want to or cannot use the equity on your home as security, then an unsecured loan is for you.
If you have an adverse credit history, and your CCJ’s, financial defaults etc are more than a year old, then you may need an unsecured loan
Loans | Tenants
If you are a tenant, you are not able to get a secured loan, because a secured loan needs your home to be collateral.
Loans for tenants | – Advantages
- Unsecured tenant loans do not need security provided against them. This is why unsecured tenant loans do not have low interest rates.
- As a tenant an unsecured loan application may be processed quicker, no need to have your home valued before the decision
Loans for tenants | – Disadvantages
- The tenant loan provider will be a great deal less patient with any defaults on the loan.
- You will find it more difficult to get approval for a tenant loan. More detailed credit checks may be carried out on you.
Debt consolidation
In the 1990′s and 2000′s loans were incredibly easy to get of course this had the side-effect of placing more people in debt, debts may range from £200 to £200,000,00. Most of these debts come from many sources, credit cards, utility bills finance arrangements etc. With debt consolidation the idea is simple, rather than paying off your bills individually which will probably have differing rates of interest, you arrange a loan that will cover all your debts, and hopefully you will benefit from a lower rate of interest on your repayments, and of course having all your debts consolidated into one loan you know exactly how much money is owed and what your repayments will pay from month to month. If your debts are current meaning you were are still paying them off as Pre-arranged by your lender then you will probably find a debt consolidation loan with a favourable rate of interest, however if your debts are outstanding debts that have may be gone to a county court or of being placed in the hands of the debt collection agency you may well find yourself paying a higher rate of interest.
Consolidating your debts, obtaining one secured loan to pay off non-secured credit loans, credit cards, store cards, catalogues etc.
Debt Loans are ideal for students.
Debt Consolidation Objectives
The object is to obtain a cheap rate loan with low cost payments, preferably without affecting your credit rating or risking any assets.
- The consolidation loan lender usually handles all contacts with your creditors,
Adverse Credit Loans
We know it is easy to get a adverse credit history, and that once its there getting things like loans or mortgages becomes increasingly difficult. CCJ’s, having no proof of income, credit history or tenant arrears can all stop you getting the loan you need.