Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk
Are you looking to borrow some money to cover those pesky emergencies expenses?
There is a choice of different type of loans available to consumers looking to borrow some money. In this short article we will look at the most common types of loans that you could consider so that you can work out which one is right for you.
A payday loan is a short-term loan normally small loan of typically around £100 to £1000 and paid out until your next payday come around at which point the loan is usually paid back either as on lump sum or sometimes over the course of a few instalments.
Payday loans are good if you’re looking for:
When taking out a payday loan you will need to be sure you have the funds available at the end of the month so that you can make the repayment.
If you want to know more about the jargon used in loan contracts read this short article here about payday loan jargon
Personal loans are loans for considerably more money than a payday loan. Typically, up to £25,000 and lent of a period of 10 years.
To apply for a personal loan, you would normal speak to your bank who you will arrange the loan with. The interest rates for personal loans will be lower than the interest rates which you will find with payday loans. This is generally due to the long period over which the loan is to be repaid. Typically, between 1 and 10 years.
Personal loans are not secure like a mortgage would be so they are not tied to an asset but if you fail to make the repayments the lender can still take you to court or pass the debt on to a collection agency who will seize any valuables they find in your home to repay the loan
A secured loan is where you the borrower will put up some form of collateral when taking out a loan. This asset could be something like your home, car or something which the lender is prepared to take if you are unable to repay the loan. This means if you secure the loan against your home and you fail to keep up repayments the lender could repossess your home. A mortgage is one of the most common type of secured loans when borrowing very large sums of money, typically £25,000 and more
Secured loans are good if you’re looking to:
Debt consolidation loans
If you have multiple loans and are finding it a bit of a struggle to keep track of all the repayments it might be an idea to take out a debt consolidation loan to make your management easier and it may possibly work out cheaper for you in the long run.
Debt consolidation loans are great if you want to pay off and close credit card accounts, overdrafts, store cards other outstanding small loans.
Debt consolidation loans are great if you just want to get a handle on all your debts and start paying them off in a more manageable way.
Many people in the U.K struggle with debts and many do not know how to start to repay them speaking to a debt advisor is one of the best things you will do along with taking action yourself by speaking directly with your creditors.
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https://www.nationaldebtline.org/ and https://www.moneyadviceservice.org.uk
You should always seek professional advice when handling debt problems. Cashute are not licensed debt advisers and any information contained in this article should not be taken as legal advice. It is your Responsibility to seek out correct legal advice