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Lenders will generally know your eligibility through a credit check. You may need to be in full-time employment or have regular money coming in above the prescribed limit. The amount you will be able to borrow will depend on your credit rating, your monthly income and the amount you can repay.
But gone are the days when you had to approach your bank and ask for a personal loan directly. These days, you can borrow money online from a network of trusted lenders – even if you have a low credit score. However, you’ll need to know the right places to look to make sure you don’t end up paying sky-high interest rates or expensive hidden fees.
It is best to spend some time researching online about the most reliable and trustworthy lenders. There are financial experts with websites and blogs who may be able to recommend you further. It’s also a good idea to read through forum posts or customer reviews to flag up any fraudulent or unauthentic lenders – it’s easy to get caught out that way.
You can consider using a lending platform that can connect you with a network of lenders that have been pre-screened. It’s a great way to find trusted lenders with the best APR (Annual Percentage Rate), ensuring your details stay safe and you get the best deal.
The type of lender you choose will depend on a number of factors related to your current financial circumstances. Recently there has been a trend of “pay-day” lenders, allowing people to borrow small amounts to tide them over until the end of the month. However, many of these short-term fixes should be avoided, as their interest rates are incredibly high.
If you only need a short-term loan, it is best to consult your bank or a trusted online loan source. The best lenders will advertise APR rates between 5.99% and 35.99% depending on your individual circumstances, so rule out any lender that charges an APR higher than this.
If you know you have a low credit score (you can check it online for free using a site like ClearScore), you’ll need to find a lender that accepts people with poor credit history. These lenders will decide how much you can borrow based on other factors – your monthly income, reliable employment, time spent at the address etc.
Be aware that late payments will adversely affect your credit score, so don’t borrow more than you know you can pay back. Most responsible lenders will calculate how much you can repay based on your monthly income, any outgoings and your chosen repayment tenor, so should not offer you a larger amount than you can afford.
Once you have found a personal lending site, you will need to apply to borrow money. This will usually involve filling out a simple form. You may be asked the purpose of your loan, how much you need to borrow and how long you think it will take you to repay it.
Once you enter these details, an online tool should calculate how much your monthly installments will be and how long it will take you to repay your loan. You will then need to provide proof of your identity, income and possibly your employment before a decision is made on the response to your application.
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