|Unsecured Personal Loans
Are you searching for a personal loan to pay off all your existing loans and credit cards, or perhaps for some personal need? If you aren't a homeowner, or have insufficient equity in your house, acquiring a loan can prove to be difficult and costly.
Unsecured loans require no property ownership or collateral for approval.
Unsecured personal loans can be taken out and used for any type of purpose - vacations, paying bills, school tuition, car repair, home improvements, etc. Borrow any amount that suits your particular situation. With an unsecured loan, your approval will you based on you personally, normally your credit history or employment status.
In other words, an unsecured loan is money leant to a customer without the need for the customer to own property whose resale value is comparable to the value of the money leant.
The primary advantages of an unsecured loan are:
- The speed with which an unsecured loan can be arranged is generally quicker than a secured loan or a remortgage
- No collateral required for any loan amount
- Anybody over the age of 18 can apply for an unsecured loan (with the exception of current bankrupts)
An Unsecured loan is ideal for those with a stable employment and residential history as well as a good credit record. In all cases, a Homeowner will find it easier to get an unsecured loan.
Unsecured personal loans are available for a range of different amounts and repayment terms. The repayment term available may depend on the purpose for which you require the loan, and may be restricted accordingly. The amount available usually ranges from $500 to $50,000 over a term of 6 months to 10 years. This will vary between lenders and products. The amount borrowed is subject to an interest charge, which will be quoted as a percentage. This rate is known as the Annual Percentage Rate (A.P.R). As a general guide, it is advisable to compare the APRs of different products as this will help you to determine how competitive they are.
The way lenders quote interest rates varies. A fixed interest rate will stay the same throughout the term of your loan, regardless of any changes in the bank base rate. If the rate offered is a variable rate, it may rise or fall in line with any base rate changes during the term. When lenders quote their APRs they will state whether these are "typical" or whether they are set at one rate for all successful applicants, regardless of the risk they present. The typical rate is a rate that is offered to over 50% of successful applicants, and the exact rate offered to you will depend on your personal circumstances, the amount and term of the loan along with the credit assessment procedures.
Personal loans are repayable monthly. The lender may permit over-payments and lump sum payments, which allow you to clear the loan over a shorter term than that agreed at the outset. Lenders may offer "payment breaks" or "repayment holidays" as part of their personal loan package and these allow you to take a break from your repayments at the beginning of the loan or at any agreed point during the term.