Can a loan help me?
Last Modified 16th of February 2021
There are times in life when you could find yourself in financial difficulty. For many people, they just about manage to get by each month on the salary that they receive. This often leads to missed payments and poor credit scores.
Sometimes unexpected bills pop up. It could be a vet’s bill or your car could break down. Whatever it is, you would need access to cash quickly. But what exactly are your loan options here?
Understanding loans
You will more than likely be faced with the option of taking out a small, unsecured loan. These unsecured loans are designed to help you out, whatever your situation. Typically they offer up to £10,000 over the course of 12 months or more.
The one thing that sets unsecured loans apart from many other types of finance is that they are available to a wide variety of people, from those receiving out-of-work benefits, to the self-employed and even tenants.
You can borrow as much as £10,000 with a reputable lender, such as Everyday Loans, but as all lenders are different, it is important that you check minimum and maximum loan amounts with the lender.
The lender will look at your monthly income and outgoings, if you’re a homeowner and your previous financial affairs to determine whether or not you can afford to pay the loan back.
In most cases, you will need a current account to apply for one of these loans. You will also need to provide:
- proof of identity, with a driving licence or passport
- proof of address, with a utility bill or bank statement
- proof of income, with a payslip, bank statements or Self Assessment Return.
Are there any risks involved?
Like any form of finance, there are some risks involved with borrowing as there’s the chance that you might not be able to pay back the money on time.
As the interest rates on short term loans are quite high, this could push you into debt. It’s not uncommon to find payday loans with an interest rate of over 4000%, but 12 month loans are more likely to be less than 100% APR.
You also really need to double check you are dealing with a reliable, trustworthy company, not a loan shark. Loan sharks are illegal and they resort to nasty tactics in order to get the money they are owed.
However, when you borrow from a genuine lender, these small loans are safe and they can be really convenient.
