A Borrower’s Guide to Unsecured Personal Loans

Unsecured Personal Loans | Guide

A leading platform to compare personal loans

Personal loans are an extremely popular form of finance in the UK. Personal loans give you easy access to the funds you need and whenever you need them.

They are also a lot more common than you might think. More than £35 billion in personal loans were taken out in the UK in 2017. This money helped Brits in a number of different ways –

  • Cover emergency costs (like a car breakdown, tax bills, and funeral expenses)
  • Pay for weddings
  • Buy home improvements
  • Allow people and families to take well-earned holidays

Personal loans spread these costs over a fixed period of time with fixed monthly repayments – that means you can plan ahead with certainty.

In the UK, personal loan industry contributes billions of pounds to the economy every year. This money ends up in local communities fuelling economic growth right across Britain.

But with so many lenders out there, how do you choose the best personal loan provider to suit your needs?

LoanTube’s team looks at unsecured personal loans and shows you how to compare them so that you can find the right deal.

What are These Types of Loans Used for?

The average Brit taking out a personal loan will usually borrow between £1,000 and £25,000. They pay the money back over a fixed repayment term of one to ten years. Short-term loans are available over periods of one month and twelve months – special consumer protection regulations apply to this type of finance.

A borrower uses this money to pay for a wide variety of projects and other bills. According to TSB, 31% of personal loans are taken out for debt consolidation purposes, 24% for house and home improvements, 25% for vehicle purchase or improvements, 3% for holidays, and 17% for ‘other’ costs.

Personal loans are the most popular way of spreading a big cost into manageable monthly repayments.

Others use a personal loan for debt consolidation. For example, you might have run up £10,000 on your credit cards and you’re paying 25% per annum interest to the credit card companies. Many Brits will borrow £10,000 on a personal loan at 8% meaning they pay a lot less in interest and they pay off the debt much faster.

Please be careful though – don’t use one form of debt to service the monthly repayments on another type of debt. Warning: Late repayment can cause you serious money problems. For help, go to moneyadviceservice.org.uk

Thinking About Borrowing Money from Loved Ones?

If you have recently borrowed money from your family or your friends, you may consider looking for the cheapest personal loans in order to pay them back. Unsecured personal loans are a strict business transaction between you and your lender – so there is no chance of damaging the relationship you have with a friend or a family member because they may want the money back faster than you agreed to pay it back to them.

You may also look at a personal loan to pay veterinary bills. Should your pet suddenly require new medication or an emergency operation, this can have a major impact on your finances. Vet clinics also often require payment up front so a personal loan could help you spread the cost of your beloved pet’s medical treatment over time.

There are many types of specially designed unsecured personal loans depending on what you need. Click the link to find out more about wedding loanspayday loanshome improvement loansholiday loans, and bad credit loans

LoanTube’s Personal Loans are Unsecured

If you’re interested in taking out a personal loan, UK lenders usually offer this on an ‘unsecured’ basis. This is important because secured loans ask for an additional layer of security in order for you to be approved for finance, such as putting your home up as collateral. This means, in the event that you are unable to repay your loan, your lender may be able to repossess your home.

Unsecured personal loans, on the other hand, do not require any security. Of course, you must still legally repay the loan as agreed but you won’t need to put your home at risk to receive the finance you need.

How Much do you Need and How Long do you Want to Take the Money for?

Whatever your reason for taking out unsecured personal loans, it is important that you have a good idea of how much money you’re going to need. In addition to this, you should also know roughly how long you would like to pay it back for.

Long-term personal loans can greatly reduce the size of your monthly repayments; however, it will also increase the total amount of debt you pay back overall. When you’re choosing the “term” (the length of time) to pay your personal loan back, make sure that you can comfortably afford the monthly repayments and that making these payments won’t cause you any hardship.

For loans that are 12 months or less, special FCA restrictions apply to look after your interests.

Responsible Borrowing

At LoanTube, we take responsible borrowing very seriously.

If you’re thinking about taking out an unsecured personal loan, lenders will need you to prove that you will be able to make your monthly repayments before they say “yes”.

Whilst unsecured personal loans do not require collateral like a secured loan, this often means interest rates and additional fees on any missed or late payments can be higher.

Personal loans can be extremely useful for emergency situations and for big projects (like home improvements, buying a car, or going on holiday) but they should never be a part of your normal financial budgeting and planning.

Why Apply Through LoanTube?

At LoanTube, we believe that while loan comparison sites are great, getting finance companies to compete to lend to you is even better so that you get the cheapest loan rates possible.

  • If you use LoanTube or a price comparison site, you’ll see headline offers from, among others:Halifax personal loans
  • Tesco personal loans  
  • Lloyds personal loans
  • Nationwide personal loans    
  • HSBC personal loans  
  • Santander personal loans
  • NatWest personal loans

You’ll also see a lot of deals from specialist lenders not on the high street.

Just like with a comparison site, LoanTube works with nearly all of them too but it’s what we do differently that saves you money. We first match you to the lenders who most likely want to work with you – we can do this because we know what each lender looks out for, on an application.

How does it work? Our clever computer system compares real-time offers made direct by payday lenders. This is all done in real-time and, once we’ve got all the quotes, we present all these offers with their terms and condition to you, to be able to take an informed decision.

LoanTube Personal Loans UK – Start your Application

To start your application for an unsecured personal loan, please click here. Remember that our service comes at no charge to you and that you don’t have to accept any of the quotes we provide you with, in case you do not like them.

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