Getting a Loan – The beginners guide
By: David Lynes
A loan is something that many of us need at one time or another, whether it is to purchase a home or car or whether it is to pay for a luxury holiday or dream wedding. Whatever your circumstances you can enjoy a choice of loans to suit your needs these days. However, if you are new to loans and have never had to look for or take out a loan before the whole process may seem daunting.
The first thing that you need to remember when looking for loans is that there are two main types of loans, and these are unsecured loans and secured loans. Unsecured loans are designed to meet the needs of non-homeowners or homeowners with decent credit. Secured loans are designed to meet the needs of homeowners only, even those with damaged credit.
In short, a secured loan offers greater borrowing power and longer repayment periods than unsecured loans, and this means that you may be able to borrow more and spread your repayments over a much longer term to keep your outgoing down. An unsecured loan means that your home is not at risk, as the loan is not secured against any asset, and also that you will be out of debt quicker. So there are pros and cons to each of these loan types, and you need to decide which is best for you based on your circumstances and your preferences.
Once you have decided what sort of loan you want to go for it is time to start comparing different loan products and packages from a number of lenders. The reason for this is that interest rates, terms and conditions, and repayment periods can vary dramatically from one lender to another. Eligibility requirements can also vary – for example, some lenders will take applications from those with bad credit whereas others may not.
You will find that the easiest way to browse and compare loans is via the Internet, as you can do this from the comfort and privacy of your own home. However, if you do not know much about loans this can still be a time consuming task, and many new borrowers find that the easy solution is to enlist the assistance of a specialist broker, who will be able to source a range of loans from a variety of lenders on your behalf in order to find the one that offers best value to you based on the details that you provide.
Remember, once you have found the right loan for your needs you can also make your application online, thus increasing convenience and ease. Do bear in mind that if you are turned down for the loan you should ensure that you do not make another application to another lender right away, as the more rejections you clock up the more your credit rating will be adversely affected. Therefore, if you are rejected leave at least three months before making another application, and in the meantime check your credit report to get an idea of why you may have been turned down.
Loans4 provide homeowner loan solutions for homeowners. Please visit www.loans4.co.uk for the latest finance related news.
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