Personal loans are not the most talked about because of the focus on home loans and car loans. Student or education loans and corporate finance are also talked about more than personal loans. But once you delve into the entire lending industry, including the banks and nonbanking financial institutions as well as private lenders, you would realise the importance of personal loans and how widespread it is. Home loans and car loans are dearer in loan value than personal loans, which is why they are in the spotlight all the time.
What are Personal Loans?
Personal loans are offered by banks, institutionalised lenders and private companies or even peer to peer lending networks. There are two types of personal loans, secured and unsecured. Banks or any major financial institution would never offer unsecured personal loans. You would have to offer collateral to get personal loans from reputed names. The collateral can be anything, a house, car, jewelry, bonds or any savings or fixed deposits that you may have. Furthermore, banks and other reputed institutions would not offer personal loans to people who have considerably poor credit or not a credit history that is required by the lender as per their policies.
If you have a good credit history and can offer collateral then any bank or any organization would be willing to offer you personal loans, within a limit that you can repay. You can then check on the interest rates, repayment methods and all other terms to determine which one would be best for you and your requirement. You can easily compare loans in UK using online calculators.
Unsecured Short Term Loans are the Best Personal Loans
If you fail the credit check or have a poor credit history, then banks will turn down your request for personal loans. You must find private lenders or solutions like Cash Kitty to get short term loans without any credit check and without collateral. It is possible that you have a reasonable credit score but you don’t have the collateral needed for the short term loans. In such cases, unsecured short term loans are the only personal loans available for you.