If you have a need to get a loan, you should not delay in dealing with this. According to experts, in the near future interest rates will not become lower. Getting a loan at a bank or a loan company today is very simple. It is now possible to apply for a loan without guarantors, certificates and checks, spending only a few minutes on the application process and waiting for approval.
Decide on the loan purpose
Before applying for a loan at a bank, it is important to determine which type suits you best. All lending products can be divided into two categories:
Targeted funds include borrowed funds aimed at acquiring a specific product or service. Most often, they are taken for major acquisitions, such as a car or a flat, or for events requiring significant expenses, such as training or repairs.
If you receive a non-targeted loan, no one will ask how you intend to spend the funds received. However, you have to pay for convenience, as non-targeted loans rates are higher, and the procedure for a bank check of a client will be more thorough.
Which loan is better to take out?
To choose the loan most beneficial for you, you need to analyse your needs and opportunities. Consider the main types of loans offered by credit organisations.
1 – Express loan
If you need money urgently and the amount is relatively small, you can turn to express lending. You can get borrowed cash not only from banks (credit), but also from loan companies by submitting only a passport and an application.
2 – Loan without guarantors and pledge
In cases where a borrower needs a more substantial amount without attracting guarantors or providing a pledge, he can take a loan according to a simplified scheme by submitting a passport, a second identity document, application form, documents from HMRC, and others. An important condition in this case is a good credit history and work experience.
3 – No employment certificates
In some situations, a bank client cannot provide a certificate of employment, like freelancers, retirees, students, and other categories that do not have a documented workplace. To get a loan they have to submit one of the documents confirming their financial solvency, for example, an abstract of account opened in any bank or documents confirming the customer’s ownership of the property.
4 – For the purchase of goods
Today, almost all major sellers of goods and services offer their customers the service of a credit sale. You can issue it directly in a store or the company office submitting only a passport and an application.
5 – Mortgage and car loans
Almost all banks offer their customers special credit products for buying a home or a car. When planning a large purchase, you should pay attention to such targeted loans, since the required amounts are very large, and it is simply impossible to get them by taking a non-targeted loan.
The probability of loan denial
Despite the fact that it is not difficult to get a loan today, denials still happen. Here are the most common causes:
- Low salary and inability to confirm additional income.
- Invalid information about a borrower: banks really check the data provided, and a lie reduces the chances of getting a loan to zero.
- Bad credit history, heavy debts for utilities.
- Bad relations of a borrower with a law, frequent offences, criminal records.
- Errors in paperwork.
- Finally, banks do not like the complete absence of any kind of credit history.
If a bank refuses to give a loan, then go to a loan company
Today more and more loan companies offer to quickly and with a minimum package of documents get the right amount of money for a short period of time. Unlike banks, loan companies are licensed exclusively for activities related to the issuance of loans.Their main advantage is that to execute a transaction only a passport and 20-30 minutes of your free time are required.
Most of these organisations work online which makes the loan service available 24 hours. Money is issued either at the loan company branch or online by transfer to a bank card. The operational principle of all online loan companies is the same. A client fills out an application on a website and waits 10-15 minutes for a decision. In case of a positive verdict, a contract is sent to an applicant by e-mail for review and signing. After a borrower accepts the terms of a loan, he is credited with money on a card. Moreover, each loan company in order to attract potential customers tries to offer the best conditions.