Why $10,000 Unsecured Loans Are Easier to Get Than Many Think

The challenge in these times of economic hardship is to access the funds so badly needed to alleviate the financial pressures we are under. Getting a loan can help greatly, both in managing existing debt and in handling those extra expenses that can come along. Thankfully, even $10,000 unsecured loans can be approved more easily than many people would think.Of course, loans of any kind come with an obligation to repay, and it is this aspect that applicants need to consider carefully. Getting a loan approval without collateral might seem excellent, but repayments must be made each month. This is the principal consideration amongst lenders, who need to know that income is sufficient before giving the green light.While bad credit is not such a damaging influence, it does play a part in deciding on the interest rate to be charged. Still, there are definite reasons why unsecured loans are available so readily, and knowing them in advance can help when applying for one.Pros and Cons of Security-Free LoansThere are specific pros and cons to getting a loan that requires no security. For example, a $10,000 unsecured loan can be used for practically any purpose, from home improvements to paying college fees to financing a European vacation. As a personal loan, it is this freedom of use that attracts many applicants.Other pros are that the loan itself can be repaid over an extended period of time, ensuring that the monthly repayments are lower and more affordable. A 24-month term, for example, could mean repayments of $475, but over 60 months may only be $200. However, there are negatives to getting an approval without collateral.For a start, the interest rate charged on unsecured loans is generally higher. This reflects the degree of risk that a lender sees in the deal, and can make the repayments too high to afford if it adversely affects the debt-to-income ratio. The ratio states that a maximum of 40% of an income should be used to repay debts.Finding the Right Lender and LoanFinding a lender that is willing to grant a $10,000 unsecured loan is relatively easy when excellent credit scores are part of the application. But bad credit complicates matters quite a lot. This is because of the increased interest rate and the stricter criteria lenders typically apply. However, there are lenders out there willing to lend to bad credit borrowers.Online lenders are recognized as experts in loan deals for bad credit borrowers, and approval without collateral is par for the course. But it is always important to read the fine print on any online deal, and to check the reputation of the lender with the Better Business Bureau website before agreeing to anything.Traditional lenders are usually too expensive in comparison, but where a positive relationship exists, it is possible to get a good deal. Half the battle to getting an unsecured loan is won when the lending officer knows the applicant.Other Pointers to ConsiderThere are other tricks that can make a $10,000 unsecured loan more likely to be approved. For example, married couples should apply for a loan together, thus halving the overall pressure on each party.Alternatively, approval without collateral is more likely if they split the sum, and each apply for a loan of $5,000 - though this may be slightly more expensive in terms to total interest paid.Of course, better terms are possible when a cosigner is included in the application. This is a person who guarantees monthly repayments will be made, thus greatly reducing the perceived risk and lowering the interest rate. This makes the repayments more affordable, which in turn makes approval of the unsecured loan more likely.