Personal Loan - A Useful Tool For Your Personal Needs
There is no such thing as a universal best loan deal Instead, there are different types of personal loans for people with different financial circumstances that can be categorised as follows:
According to recent statistics, more and more people in the UK are availing secured personal loans, as they are much cheaper than other loan options like unsecured personal loans and payment cards (credit cards, store cards, charge cards and overdrafts).
A secured personal loan is availed by offering collateral against the loan amount. Presence of collateral makes it easy for the lender to part with his money and facilitate the borrower with quick attention, high credit limit, competitive low APR, flexible payback terms and negotiable loan conditions. Hence, opting for a secured personal loan makes sense when the monetary requirement is big or credit record is poor or an unsecured loan application has been denied.
A secured loan deal has one risk (collateral seizure) in case of repeated defaults or non-payment, the lender gets the authority to sell the pledged asset to recover his investment. And, one limitation (slow approval process) the loan application can only be approved after time-consuming property evaluation along with other credibility factors.
However, it makes no sense risking a property for something that could be solved by another mean like unsecured personal loan. The most outstanding features of an unsecured personal loan are: no collateral (no deposit against the loan amount), less paperwork (no red tape), quick service (fast loan processing) and no immediate risks in the event of repeated defaults or non-repayment. Hence, opting for an unsecured personal loan makes sense when:
An unsecured personal loan too has certain limitations limited amount, high APR, fixed payback terms, non-negotiable loan clauses because in the absence of collateral, the stakes are normally high for the lender. There are a variety of lenders offering personal loans in the UK today, from traditional high street banks and building societies to online banks and supermarkets. With varying personal loan deals APR s, Payback Methods, Accelerated Repayments, Repayment Holidays, PPI (Payment Protection Insurance) credit shopping becomes imperative.