No Guarantor Loans

5 Positives and 5 Negatives of No Guarantor Loans

It is always seen as a problem to save after spending. People often make the mistake of saving funds after spending. For the better life and financial well-being, it is always right to spend what is left after saving. However, saving funds is not always an easy task especially when you do not have a habit of doing it.

Why budgeting is important for everyone? Of course, if you buy things that you do not require today, you have to compromise with your desires later. What if you do not have a habit of savings and suddenly require a quick flow of funds? Will you try out a loan at the moment? In a recent scenario, no guarantor loans have become increasingly popular among the borrowers. The loans are easily made available to the Britons at the touch of fingertips.

Technology has boosted tremendously to provide the convenience of a solution with the loan. However, if you do not handle the loan carefully with proper planning and budgeting, you may have to face problems. Since the loans provide money for the things you require, you should know ins and outs first. Here is the brief information about positives and negatives of no guarantor loans:

Positives

#1: Less Paperwork

As compared to other loans where providing a guarantor is mandatory, these loans offer the convenience of filling out application form within a few minutes. The online lending process does not require documentation and you will save a lot of time. In short, there is no obligation to go through the formalities if you want to secure approval on the loans.

#2: Prompt Approval

Apart from the hassle free application process, the lender will never keep the borrower waiting for the loan approval. You will receive the instant decision on your loan request. This is because of the elimination of the process of submitting umpteen documents and the entire process takes place online. Therefore, the days of ripping hair from your head have gone.

#3: Relaxed Eligibility Criteria

Short term loan lenders have typically more relaxed and easy eligibility criteria than the conventional lenders. They let the borrower access funds without pledging the collateral or assigning a guarantor. The loans are easily available to Britons, who have a valid savings bank account. A steady income can help the youths to secure approval on the loans.

#4: Easy Payment Plan & Limited Duration

The repayment plan and duration of the loan is quite beneficial to ease the financial pressure. Usually, the loans can be paid back quickly because the payment plan is no than 18 months. This means that you can clear your debts as well as loan repayments quickly which is often comfortable. In fact, you can choose the loan tenure as per your convenience.

#5: Opportunity Even for the People with Bad Credit History

In recent years, the lending nature of the lenders has changed. The borrowing options for bad credit people are available in a wide range. Online lenders have come up with a variety of loan options specifically tailored for bad credit borrowers. From the online lending companies, availing bad credit loans with no guarantor and no broker is now easier for you.

Negatives

#1: Higher Interest Rates

No guarantor loans are personal in nature and available for a short span of time. Short term loan always comes with high rates of interest because you do not have much time to pay it back. Besides, the interest rates of loans depend on other factors such your income status and past credit record. In short, if you are eligible for the loans in spite of bad credit status, you are going to pay a high cost for this benefit.

#2: Only Small Loan Amount

Accessing funds in the absence of guarantor and a clean credit score does seem to be stress relieving. If you are living on a tight budget and your financial condition is getting weak, you can consider these loans. But there is a downside that you could not apply for the large loan amount. In other words, if you need to meet long term desires, you are not a perfect candidate for these loans.

#3: A Job Is Must

The biggest restriction of these loans is that you cannot borrow funds if you are out of job. Keeping in mind your bad credit situation and inability to bring a guarantor, it is mandatory to have a job. Actually, a regular monthly income is an evidence for the lenders that you can afford to repay the loan. If you are going to shop these loans, make sure that you have a proof of income.

#4: You May Lose Your Collateral

Judging by your current situation, the lender may ask you to pledge the collateral. Do not be surprised, there are a few lenders, who can ask you to put up a valuable asset. Maybe you agree to provide an asset for securing funds as you have no guarantor and credible credit score. By doing this, you will get the funds but a risk of losing your property is always involved.

#5: No Scope for Very Bad Credit

The loans for people in time of urgency can be a valuable tool to get rid of financial worries. However, if you do not offer collateral, you can be denied for availing very bad credit loans with no guarantor. This does not mean that you are left with no option. If you want to get accepted for a loan, you have to search hard.

Despite having the drawbacks, the opportunities are still available. Tons of lenders are working online these days and ready to offer loans as per borrowers’ requirements. Protect yourself from the financial crunches with these loans only if it is absolutely necessary.

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