Instant Unsecured Personal Loans: What To Look For And Where To Apply
Low credit scores and financial emergencies are a poor mix, and having nothing of value to use as collateral makes things worse. Thankfully, there are instant unsecured personal loans available online.
The problem with financial emergencies is that they can crop up at practically anytime, and leave your budget in tatters. So, having an option available that provides loan approval with no collateral can prove to be a lifesaver in many situations.
But where is a good source of such unsecured personal loans, and what are the criteria that need to be satisfied before approval can be expected?
Why Seek An Unsecured Loan?
Unsecured loans are known to be the most expensive loan options out there. But while it seems wise to avoid them, the unfortunate truth is that applying for instant unsecured personal loans sometimes cannot be avoided.
The issue is what to provide as security for the loan. For large sums, the problem is finding something valuable enough, but when a modest sum is needed instantly, the problem is finding an item of collateral quickly enough. Even if collateral is found, defaulting on the loan means losing a possession of value.
But the good news is that getting approval with no collateral is very possible as long as other key factors are in order. And while the interest rate charged on the unsecured personal loan is higher, the terms from particular lenders can be good enough to make the deal worthwhile.
Key Factors To Consider
The most important factors that lenders consider when assessing a loan application are the employment status of the applicant and the amount of existing debt that they have. When seeking an instant unsecured personal loan the applicant needs to confirm loan affordability.
Obviously, loan applicants need to have a source of income in order to repay the loan – thus the importance of being employed. But employment needs to be fill-time and the income large enough to cover the monthly repayments. Getting approval with no collateral is dependent on these factors.
The significance of existing debts is represented by their debt-to-income ratio. This is set at 40:60, stipulating that no more than 40% of an income be used to repay debts, leaving 60% to cover general expenses. If the repayments on the unsecured personal loan stay within the 40% limit, then approval is likely.
Instant Loan Options
Not every lender provides instant loan approval, and no instant loan deal is suitable for everyone. This is why it is a good idea to search through the instant unsecured personal loan options that are available. By and large, these are to be found online.
A common option when seeking fast approval with no collateral is a payday loan. But it is limited to $1,500, and come with extremely high interest rates and very short repayment periods (30 days). For sums of between $3,000 and $10,000, online lenders are the best option.
As experts in bad credit lending, they offer terms that are more manageable for bad credit borrowers. And with an application process that takes just minutes - thanks to the fact no credit check is carried out - even an unsecured personal loan can be transferred to your own bank account in a matter of hours.
Source: Free Articles from ArticlesFactory.com
ABOUT THE AUTHOR
Donna Hammond is the author of this article. For more information about Bad Credit Motorcycle Loans and Rv Loans for Poor Credit please visit her website at http://www.quickbadcreditloans.com/