Loans Articles



Summary

There are loans available for all sorts. Lenders will need to check your credit references. Secured loans are easier to obtain than unsecured.

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It would appear that there are agencies out there offering loans for absolutely everything. A new kid on the block is a ‘career development' loan with ‘significant benefits for those wishing to further their studies' according to the blurb. Apparently this type of loan has attractive incentives for borrowers over and above a normal personal loan, such as offering a repayment holiday at the end of the course of study. Students and those continuing their professional training will certainly like the sound of that.

And when these young students have graduated and are embarking on their careers, thinking about buying their first homes, there is another loan on offer from some lenders in the shape of a ‘professional mortgage'. With this hybrid the lender targets the newly qualified doctors, dentists and solicitors, whom they hope are at the start of long and prosperous careers, and willingly lends them more than would be available on a normal mortgage to non-professionals.

But whatever type of personal loan you want and no matter what it is for, it is something to be taken seriously. Before you get any loan the lender will check out your credit history. Some very attractive sounding mortgages and loans with good interest rates are advertised, but if your credit record is not equally attractive to the lender you won't be eligible for them.

The lender needs to consider your financial situation to decide if you are likely to make your repayments on time, or otherwise, and a credit check will reveal your entire credit record. If you missed a couple payments on your credit card it could show up. Certainly if you have any County Court Judgements against you the lender will be suspicious. You may still be able to get a loan, but not at the more favourable rates offered to a lower risk borrower.

With a slightly tarnished credit reference you are more likely to be successful in obtaining a secured loan. This is where the loan is secured by an asset, usually your home, so that if you default on your loan repayments the lender can force you to sell your house in order to make the payments, unless you can get hold of the money from another source. Secured loans are available at better interest rates and over longer periods then unsecured loans as they are lower risk to the lenders.

It's clear that what is lower risk for the lender is higher risk for the borrower. We would reiterate that any loan is a major commitment and any borrower should seriously consider whether they can afford it.

As always, we advise you to shop around and check out the internet comparison sites. Or use an online broker to investigate the whole market and present you with a shortlist of the best deals for you to consider.

The newly qualified professionals needing loans are going to have to go through credit checks. They should make sure they can demonstrate a responsible attitude to credit – even that they pay off a credit card in full and on time. A little good credit history gives lenders a better feeling none at all. They are more wary about lending to someone who can't prove they are reliable as they have never had credit in their life before.