Quick Loans In The UK: What You Need To Know

 

In the United Kingdom, fast loans have become a speedy and convenient solution for those facing unexpected expenses or cash flow issues. Our guide offers all the necessary information you need to make an informed decision when considering a fast loan. From the various types of quick loans available and their eligibility criteria to the application process, repayment options, and potential risks, we comprehensively cover them.

Understanding Quick Loans

Quick or short-term/ payday loans provide borrowers immediate access to funds- within a few hours or even minutes of approval. These loans are for small amounts, ranging from £100 to £5,000, and are intended to be repaid within a short period- like a few weeks or months.

What Are The Types Of Quick Loans?

There are different types of quick loans available in the UK- each with its unique features and benefits:

●       Payday loan: Borrowers are expected to repay payday loans in one lump sum on their next payday, typically within 30 days. However, due to high-interest rates and fees, payday loans can become a costly option for obtaining credit.

●       Instalment loans allow borrowers to repay the loan over monthly payments (for three to 12 months). They are more manageable than payday loans as the repayment amounts are spread over time.

●       Guarantor loans: A guarantor is a person who signs the loan papers and promises to pay back the loan in the event the borrower doesn't. Lenders can feel more confident giving out loans to borrowers with credit scores in the low range because of all of this.

●       Line of credit- It is a flexible form of borrowing that allows borrowers to borrow funds as and when needed, up to a pre-agreed limit. Interest is only charged on the amount borrowed, and repayments can be made anytime.

Eligibility Criteria For Quick Loans

To qualify for fast loans, borrowers generally need to meet specific criteria. These requirements may vary depending on the lender. Still, most borrowers must:

●       The minimum age for a borrower is eighteen.

●       Applicants must reside in the UK.

●       They have a steady source of income from either employment or benefits.

●       Possess a valid UK bank account and debit card.

Along with the basic eligibility requirements, lenders will conduct credit checks, including reviewing the borrower's credit history, income and expenditure, to ensure they can comfortably afford the loan repayments.

Conclusion

While a poor credit history makes securing a fast loan more complex, options are still available for such cases. For example, some lenders specialise in offering loans to borrowers with bad credit, and guarantor loans can also be a great alternative.