Tag Archives: borrow
Unemployed Loans – Timely Loan For Cash Requirements
When there is no job in hands, then it becomes harder to meet your cash needs for regular purposes or for starting a small business to support yourself. Unemployed loans may be a good option in such circumstances. Even if you have lost a job recently, these loans can help you in borrowing timely cash help.
However, the applicants should prove their repayment capability in order to get approval from the lenders. Tell the lenders the way you are going to have the money for timely repaying the loan installments.
It is advisable to take unemployed loans with a co-signer who has a good credit history for instant approval. The co-signer may be your parent or anyone who is willing to take responsibility to repay the loan. The co-signer will also be useful in borrowing the money at comparatively lower rate of interest.
These loans are available in secured or unsecured options. The secured loan requires you to borrow against a vehicle, home or any other valuable property as collateral. Such a loan comes at low rate of interest because of collateral. Depending on value of collateral, you can borrow up to £75000 or less for its repayment in 5 to 30 years.
The unsecured unemployed loans are given without collateral. But you will be approved smaller amount ranging from £1000 to £15000 for a shorter repayment duration ranging from few months to 10 years. But such loans carry higher interest rates.
Your bad credit history of late payments, defaults and CCJs is well taken care of if you can prove your repayment capability and if you take the loan along with a co-signer having a good credit history.
Compare as many offers of unemployed loans on Internet as the online offers of the loans are generally less expensive due to intense competition amongst the lenders. Make sure that you borrow the money to repay it on the due date of the installments.
Are Payday Loans Good or Bad?
When it comes to Payday Loans there is divided opinion on whether they are a good thing or a bad thing. But why are they perceived by some as a bad way of worrying? To look at this we first need to look at exactly what are Payday Loans?
The clue is in the name. They are a short-term loan designed to paid back on the borrowers next Payday. Therefore, the loan is designed only to be borrowed over a few days or at a maximum of a few weeks.
The key with any borrowing that is taken out is that the borrower is always keen to know the APR. This is understandable and this is why Payday Loans are sometimes criticised. The APR on a Payday Loan is high very high. However, the key with a Payday Loan is remembering that you borrow the loan only over a matter of days. APR stands for Annual Percentage Rate so is therefore a percentage rate over a year. It is therefore deemed a little unfair to judge a payday loan over a year as nobody would borrow the loan over that length of time.
It is common knowledge that if you were to borrow an unsecured loan over a few years you can expect to pay back sometimes double of what you initially borrow especially if the length of time the loan is taken over is a few years. So how does this compare into the Payday Loan world?
It is hard to give a specific figure on the amount of interest you will pay on a payday loan as there are many lenders that have different rates. It would not be unfair to say that you may pay back £30 of interest for every £100 borrowed. So, a £300 loan would cost you a total of £390. This would be at an APR of 2000%+ Sounds high? Well, remember the APR is if the loan was borrowed over a year but you will only borrow it for a few days/ weeks.
On the above Payday Loan model you are paying about 1/3 of the amount borrowed in interest. How would this compare to a £5,000 unsecured loan borrowed over 7 years? A 1/3 more of the amount borrowed would be a total payback of about £6,650. This could be achieved at a monthly payment of around £98. So the APR would be similar as the Payday Loan? No. The APR on this example would be about 12.4%.
I hope the above example highlights the “APR argument” when it comes to Payday Loans. You can pay the same split of interest on a Payday Loan as an Unsecured Loan and the APR is massively different the sole reason for this is that a Payday Loan will only be paid back over a matter of days.
Do Payday Loans deserve their bad reputation? Probably not. If they are used correctly, as a short-term financial product instead of a long-term financial solution, and they are paid back on time then they are an excellent form of short-term borrowing in an emergency.