|
A personal unsecured loan is precisely what it suggests, a loan 'not secured' on your house, for you to use as you would like. People often use them to buy a car, a dream holiday, house renovations, or maybe to pay off spiralling credit card bills at one time, thus giving you freedom to spread the installments over a longer term at a lower interest charge.
With an unsecured loan, what amount can I borrow?
You can normally take out a personal unsecured loan for up to £15,000 (if you have a good credit rating) but some unsecured lenders can offer you up to £25,000 unsecured (if you have an EXCELLENT credit history). However, keep in mind that you are required to be able to afford the loan repayments. With unsecured loan applications, you can normally get approval in principle over the telephone.
What are the min/max repayment periods for an unsecured loan?
This partly is up to the unsecured loan provider. A number of unsecured loan companies would offer an unsecured loan for as little as twelve months, though a 5 to 7 year term is more likely. The maximum unsecured loan length is normally 7 years but a number of unsecured lenders will loan over 10 years. Unsecured loans are more suitable for applicants who want to repay something over a few years. For people who only want the money for a short period, for instance, six months, purchasing with a credit card may be cheaper. You might have found this web page after looking for any of the misspelt keyphrases, like 'cheapest unsecure loan rate', 'adversre credit unsecure loan' or even 'easy unsercure personal loans'. However, the content here should prove useful.
How does the unsecured interest rate work?
Unsecured loan interest rates are usually fixed for the duration of the unsecured lending agreement, which means you know exactly how much you are required to pay back every month. The drawback is that you might repay more than others who borrow a similar unsecured loan in 6 months' time - on the other hand, you might pay less! Either way, you will not have to worry about loan repayments escalating. Some unsecured loan companies will request that you take out a direct debit for the loan repayments. Typically, the loan interest rate is less if you borrow a larger unsecured loan. With unsecured loans, the critical point to check out is the Annual Percentage Rate (APR). In addition, it is important to know the amount the unsecured loan will cost you in total.
Do unsecured loan applications include a credit score check?
Yes, unsecured loan companies have to make sure that you are an 'acceptable risk' and therefore don't carry a past of bad debts and neglected debts. To accomplish this, the unsecured loan company will request your credit record from a credit reference agency - Equifax, Experian and CallCredit plc. An impaired credit past will not automatically preclude you from getting a personal unsecured loan, however, you will probably get an offer with an increased rate of interest. You might find it harder to get a personal unsecured loan if you are self-employed or if you have a short term employment contract.
What is an unsecured loan payment protection insurance?
This is an insurance policy you can take out to pay (under certain conditions) the monthly loan repayments in the event you cannot - for instance, if you've lost your job. Think carefully if you really need this or not. Unsecured loan payment protection insurance (a bundle with the loan) is often costly and if your financial situation is uncertain, is it the best move for you to be borrowing more money anyway? Should you decide you do want a payment protection insurance, ask about exclusions and small print which could make it hard for you to benefit from the cover.
|
