I Need a Loan - What Are My Options?
When it comes to finding the right loan, it can be difficult to know which is the best. It all depends on how much you’re looking to borrow and how long you want to spend paying it back.
There are also other factors, such as if you want to improve your credit rating, which you have to take into account as they could be just as, if not, more important.
Regardless, a nice list of all your options would help a lot in your search. Below is a list of all the best loans you can take out.
Personal Bank Loan
The most obvious choice is to take out a personal bank loan. This is a great choice as it allows you to prove to any bank in future of your great credit score and better your chances of obtaining another loan in future.
All personal bank loans are loans made that are not secure against any asset such as your home or other personal items. You can pay it all off or in part if you choose to do so before finishing your payment period.
The downside to these is that if you fail to pay back your loan it can seriously affect your credit score. Interest rates can also be a problem for you if you fail to give back what you owe.
Credit Card
While not a “loan” in a traditional sense, a credit card certainly does give money to the borrower to spend. Every credit card taken out has a spending limit and each month you’re supposed to pay it back.
There’s also interest on top of that and these can vary from company to company, however, it is usual for many credit cards to be interest-free for its first year.
The major downside of any credit card loan, aside from the interest, is that it’s very easy to lose control and spend outside your means.
This is why it’s important to get a credit card only if you are committed to paying back the money you’ve spent. Otherwise, you’ll wind up in a lot of debt.
Payday Loan
Payday loans are a small unsecured loan that, despite their name, have nothing to do with payday. They can go up to a few thousand pounds and are a quick and easy way to obtain money quickly.
The biggest drawback is that their interest rates tend to be higher than any other kind of loan, which can become an issue if you’re struggling to pay it back.
On the other hand, it is for a comparatively smaller amount of money than the average loan, so the money has to be made back somehow.
Regardless, this is the best kind of loan if you need it quick and want to pay it back quick also.
Pawn Loan
Finally, another kind of loan you can obtain, and it’s one many don’t consider, is a pawn loan. These loans are special as you exchange a valuable item for cash of up to £5,000.
The item itself can be almost anything of value but it is typically jewellery. Once given to the pawnbroker, you have around six months to pay off your loan.
If you fail to pay off your loan, the pawnbroker is within their rights to sell your item to recover the lost funds. However, you will never need a perfect credit score to do this with.
Are you looking for a short term loan? Why not get a loan from Cuttings the Pawnbrokers? Find out what we lend against!