Personal Loans- Borrow What you Need

By: Eric

Personal loans are a godsend for people facing a financial crunch. Multipurpose in nature, these loans can be used for almost any purpose. Cellulite reduction or colour therapy, home renovation or a feng shui garden, buying a Lenova notebook or Stella McCartney's latest designs- all are legitimate expenses as far as a personal loan is concerned.

Certain requirements have to be fulfilled before taking out a personal loan. Terms and conditions vary from lender to lender. A good credit rating is a magic word for the borrower, as well as the lender. It is a sure shot way to open up the doors of more and more lenders. Also some lenders may require you to have a certain income level per month. Additionally, they may require employment proof and salary slip.

Personal loans may be of two types- secured and unsecured. If you are a UK homeowner then you can opt for a secured loan by placing forth collateral. If you don't want to risk your property, then going for an unsecured loan is a safer option. From the lenders point of view, an unsecured loan is a risky bet as there is no guarantee that he will get back his investment. Financial authorities like FISA (Financial Industry Standards Associations) and FSA (Financial Services Authority) grants some leeway to these lenders. They are allowed to charge comparatively higher interest rates as against secured loans.

A secured loan has the advantage of a long repayment period with flexible repayment terms. As collateral is involved, the lender is sure of getting back his money. In some cases, they may also allow the loan seeker to dictate the repayment terms. Prospective borrowers may shop online for cheap personal loans to suit their financial situations. Loan seekers can also use the online financial calculators offered by some online lenders to find out what loan amount they can afford.

Personal Loans
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