Tag: Unsecured Loan

Here Is Your Guide to Guarantor Loans

However much we all desire to have good credit ratings, life happens and things beyond our control. You might need a loan but due to your bad credit history, chances are most financial institutions will refuse to give you a loan or might give you with insanely high-interest rates. This is where guarantor loans come in handy. The good news is same day guarantor loans are increasingly becoming common today.

What is guarantor loans?

A guarantor loan is a loan type in which a person with bad credit is given A loan using the credit ratings of another person (probably a close friend or relative). The loan is based entirely on the guarantor. Amazingly you could even get lenders giving guarantor loans instant payout.

Who can act as your guarantor?

A guarantor should not be financially connected to you and must be 21 years and above. He/she must have good credit history and in some countries, must own a property. This loan is unsecured in nature and the guarantor is perceived as the security.

What requirements are needed to be eligible for a guarantor loan?

You must be 18 years and above (might be different for some countries), must have a bank account, must not be bankrupt and must be a resident of that country. Read more.

How much interest will you pay?

The interest rates will depend on the lender. Chances are you will be able to get a high amount of money with very little interest if the guarantor has amazing high credit scores.

What if you default payment?

In case you default payment, the bank will ask the guarantor to pay.  You will be chased for the remainder of the loan and any interest built up. If the guarantor defaults payment then the bank can take you both to court.

For a person considering to be a guarantor:

What questions should I consider before agreeing to be a guarantor?

  • Why does the borrower have a bad credit history?
  • Is he/she responsible enough to pay?
  • Does he/she really need the loan?
  • Are you willing to risk your property as security should the loan fail to be paid?

How should you protect yourself as the guarantor?

Limit your liability. Do not cover all your borrower’s obligations including other debts like car loans etc. It is safer to have a limited guarantee (guarantee agreement limits the amount you guarantee).

Receive Documentation.

Never forget to ask for the documentation. Ask for the credit agreement which will state the payment schedule and the terms of the credit. This is usually given with two weeks after signing the guarantee contract. Also, ask for the guarantee contract a proof of your agreement. If the borrower defaults payment, he/she is issued with repossession notices that the lender must send to you too. If there are changes in the credit contract, the borrower should inform you. As a guarantor, you can take the creditor to court if you think the credit terms are oppressive.

Finally, guarantor loans are a good, easier and cheaper way to get loans. But both the borrower and guarantor should be very careful before taking one because a default in payment will do a number to their creditworthiness and lower their score greatly. Check out more: https://www.trusttwo.co.uk/borrowing-from-us/is-a-guarantor-loan-right-for-me

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Defining the Term Unsecured Loan

Over one million consumers are said to have opted for an Unsecured Loan last year in a bid to consolidate their outstanding debts. If Personal Loan Interest rates rise any further though, the country could hit further economic turmoil as unsecured loans may become too expensive for the majority of the country. Therefore, it is imperative that you seek professional advice when looking for the right unsecured loan for your circumstances. To be accepted for a most Unsecured Loans you must be a full citizen within the UK and you must be over 18.

Unsecured Loans are a form of financial assistant that can be obtained without being secured by any form of collateral.

For this reason, they are a very popular form of financial assistance. This type of loan is perfect for individuals who do not own their own property as well as for tenants, students and even homeowners who don’t wish to risk their own property.

Loans that aren’t secured against property are ideal for those looking for a quick way to obtain capital as payments are usually made on the same day of application. These loans are ideal for those wanting a small loan with a short repayment term. Although, higher loans (over £10,000 for example) can usually be arranged that also have longer repayment terms. With an unsecured loan, the maximum lending amount is typically £25,000 from most UK Lenders. Lenders determine an unsecured loan agreement depending upon the borrower’s personal circumstance and therefore payment breaks can be arranged and repayment terms can be designed around the borrower’s financial need.You can read an interesting post about personal loan at http://www.cifoundation.net/personal-loans-options-explained/

Unsecured Loan

To qualify for this type of loan, credit checks are made by the financial services to ensure that you are a ‘trustworthy’ investment to the lender. The risk involved to the lender in providing this type of loan is neutralized by significantly increasing the interest rates; it is rare to find a ‘low interest’ unsecured loan. Unsecured Loans are very much a ‘last resort’ option and great if you need the money to fill in the gap of short fiscal need. They also often come under various guises including: ‘Personal Loans’, ‘Tenant Loans’, ‘Pay-Day Loans’ and ‘Car Loans’ to name but a few. This is because unsecured loan payments can be used for almost anything, from unexpected healthcare expenses to paying for that dream holiday or ideal car.

Obtaining this type of loan is still extremely difficult however, especially given the current economic climate, as discussed above, lenders have only recently re-entered the market and are much more wary of who they lend to. Nonetheless, most Lenders can be found online, for example, online Guarantor Loans usually provide loans of around £3000. Although, the increased absence of lenders in the market means it’s all the more important to research all the options available for your circumstances. Lenders recommended by a financial adviser are likely to be much more reliable than some of those found online.

As mentioned above, a loan of this type is determined by the consumer’s credit history, which is not so great news for people with bad credit. However, the recent advent of ‘Guarantor Loans’ has made getting a Loan much easier if you have bad credit. Guarantor Loans instant payout are a type of unsecured loan which require you to have someone (a family member/friend) to take care of the debt, someone who can help you out if you have trouble paying by taking responsibility of the debt; they guarantee the loan. This type of loan is also ideal for young people and students and it’s rapidly becoming one of the most popular finance products in the market today. For most lenders, the guarantor has to be at least 21 years old, a homeowner and have a decent credit history. Same day Guarantor Loans are ideal for people with bad credit as they are determined solely upon the credit history of the Guarantor, so it is vital to discuss all the …

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