Loan shopping is about finding the right lender who will approve your loan at the best possible rate which can save you thousands of pounds. An understanding of lending basics will go a long way in helping you track down the best loan for you.
The Internet is the best place to find just about anything. Besides shopping from the comfort of your home,
Internet users are blessed with the same items at prices that can't be matched by the high street shops. Whether you are looking to buy a new kitchen for your home, buy new clothes for an event, take the family on holiday or shop for loans, you will find the best offers on-line.
Loan shopping is about finding the right lender who will approve your loan at the best possible rate which can save you thousands of pounds. An understanding of lending basics will go a long way in helping you track down the best loan for you.
This article is not a definite guide to borrowing money, instead, it's a comparison of some of the loan types available to you. Whether you have a perfect credit score or not, the comparisons outlined below have the same money saving outcomes allowing you to make big money saving decisions.
Personal Loan vs Credit Card
A personal loan offers lower interest rates and is usually a far better option than using a credit card to make a purchase. Although Credit cards are amongst the most expensive credit they can be useful when on holiday or in event of emergency when you require instant funds. Credit Cards work in a similar way to overdrafts and provide short term funds for small amounts of money but for this convenience you will be required to repay these loans at high interest rates.
Personal Loans can be approved within a few days, so, if you can be patient, taking out a personal loan will meet your needs and will cost you far less.
Secured Loans vs Unsecured Loans
When you apply for a personal loan, depending on the amount you require to borrow, you will usually have a choice in selecting a secured loan or an unsecured loan.
A secured loan is a personal loan that uses the equity built up on a property or other asset that you own. Secured loans boast many benefits to the borrower such as longer repayment time and better interest rates.
An unsecured loan does not require you to secure anything against the loan. Because the risk is higher for the lender unsecured acceptance is tougher, repayment term is usually shorter and interest rates are higher. Furthermore, it can also be difficult to obtain unsecured loans for large amounts of money.
When you compare unsecured loans to secured loans you will find the main differences are the cost effectiveness for the amount of money you wish to borrow and the amount you will be required to pay back. Unsecured loans are more expensive and lenders have tighter criteria.
The cost effective Loan
If you are looking for a loan which is cheap and easy to get regardless of your credit score and you have enough equity available in your property then a secured loan is for you.
