Are you looking for a personal loan buying guide?
If you are indecisive about getting a personal loan, then you probably need a guide to help you choose the best loans whether secured or unsecured one. The article enlightens you about the personal loan buying guide .Take a look at it.This article covers- What is a personal loan buying guide?
- What are the important features of a personal loan?
- What are the types of loans?
- Glossary of a personal loan buying guide
There are varied structures to personal loans. The Important Features of a Personal Loan are:
- The security that is required for the loan
- The APR or the rate of interest
- The repayment schedule
Types of Loans
One of the key distinctions between the different types of personal loans is the security that the lender requires. By security we refer to the collateral that is offered to the bank in order to secure the loan. If you default in your repayment schedule, the lender reserves the right to take hold of the collateral and seize it so that he may repay the loan. Top quality collateral would reduce the risk to the lender, who would therefore be offering the personal loan at a much lower rate of interest. We find that individuals who have a history of adverse of credit rating or who have declared bankruptcy, usually find it difficult to obtain a personal loan, without having to first offer top quality collateral to secure the loan.Unsecured Loans
Unsecured loans are those personal loans that are- Made to individuals which do not have a pre-requirement of collateral, as the credit quality of the individual and his financial circumstances, are sufficient enough for the lender to provide funding/credit without collateral.
- We find most lenders limiting the amount of the unsecured personal loan to less than 15,000 or 25,000 pounds, without special credit approval.
- Lenders might explicitly restrict the unsecured personal loan so as to exclude a particular purpose- for example, starting a business.
Secured Loans
Most secured personal loans utilize- The excess equity in your home, or any other properties as collateral. But other assets are also accepted. Home equity is the nothing but the difference between the total value of your house, and the amount of mortgage that is outstanding on it.
- It is important to note that as you are using your home as your collateral, you are putting it at risk, if you fail to make your loan repayments on time, and according to the term payment schedule.
- The amount of personal loan could be limited by the value of the collateral.
- The loan could be used for almost any purpose, however, and is very often cheaper than an unsecured loan.
Short Term Personal Loan
The features of such short term personal loans extend to include:- A high rate of interest, on account of the period or repayment being for a very short term.
- Banks who disburse these short term personal loans, usually insist on collateral, but financial online companies require only a credit check before approving the loan.
- Both banks and financial companies have limits to the amount of loan that is to be offered, and those individuals who require larger sums, will have to tap other sources
Fast Cash Advance Loan
: Sometimes you are in need of fast cash, a quick payday loan, to meet an unexpected money crisis. This is where a fast cash advance loan comes in handy. A fast personal loan is- Very alike a bank loan-only cash advances are for a shorter term, and easier to qualify for.
- Requires that the applicant must be at least 18 years of age.
- Traditionally for a two week term
- There are maximum limits to the fast personal loans borrowed.
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