Unsecured Tenant Loans - Borrow Without Incurring Risks

By: Peter Taylor

Though being risky borrowers, lenders are less hesitant in these days of high competition, in approving tenants for loans. The best aspect from the tenants' point or view is that they do not have to provide any property to the lender. This means that they can borrow money without worrying about their non-homeowner status. And lenders have put no restriction on using loan amount. So a tenant can use loans for buying a car, clearing past debts, paying for holiday expenses, going for debt consolidation option or using the loan for wedding celebrations.

Lenders do not ask tenants to offer collateral for loans. This makes the loan availing easier as far as searching for a property is concerned. The only caution the lender will take is that the borrower is in a sound financial position to repay the loan in timely manner. In other words an unsecured loan for tenant will come only after the lender has gone through borrower's income and employment documents.

Still the lenders' ensure reducing risks. So, the loan amount for tenants is kept smaller in the range of ?5000 to ?25000 depending on borrower's circumstances and repaying ability in mind. The loan repayment duration is also kept shorter in the range of 5 to 15 years.

To further cut risks, lenders charge interest at higher rates on loans offered to tenants. Clearly these are costly borrowings. But good credit history tenants may borrow money at relaxed conditions and lower rate of interest.

Those tenants past late payments, defaults, arrears or CCJs and IVAs also are being approved for unsecured loans if such bad credit history borrowers can convince about timely repaying of the loan.

For tenants, the best considered source of loans is online lenders. these lenders charge interest at competitive rate and approval for bad credit borrowers comes with comparative ease. There less additional fees of online lenders involved in the loan offer.

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