Loans for Big-ticket Items and Urgent Expenses

Consumers can choose from different types of loans, including secured and unsecured. Brick-and-mortar banks, peer to peer lenders, and other providers offer unsecured loans for people with bad credit.  Standard loans are offered to customers with solid payment history or business revenues.

Unsecured Loans and Types

Customers apply for loans to purchase big-ticket items, pay unexpected expenses, or fund home renovation projects. Car financing is offered by banks, credit unions, dealerships, and other entities. Financial institutions that offer auto loans request information such as vehicle age, model, make, etc. College financing is offered by banks and under government programs. Loans under different government programs come in different varieties, including maintenance and tuition fee loans. Collateral is not required when applying for an unsecured loan, whether student, auto, or consumer loan. The most important factor for banks is whether borrowers are able to meet their payments. Poor credit is one of the reasons why banks turn down applications.sofa

Applicants with a High-risk Profile

Borrowers with poor credit often fall victim to loan sharks, but there are other options. It takes weeks to get approved for a standard bank loan but payday lenders advertise instant approval. Both non-bank lenders and banks offer payday loans as an alternative to standard types of financing. Given that lenders don’t run a credit check, this is a good way to get quick cash. Borrowers fill in information such as their employer and income when applying for a payday loan. In addition to high interest rates, some lenders use unfair practices. Secured loans feature better terms, but they are offered to customers who pledge some valuable item as a guarantee of repayment. Secured loans are usually used for large purchases and refurbishment projects. Lines of credit and credit cards are two other options for borrowers to consider.

Information and Documents to Enclose

Borrowers are usually asked to present documents such as recent salary slips, photo ID or passport, account statements, and others. The types of documents required depend on the employment status of the applicant. The requirements are different for self-employed individuals and unemployed workers. Unsecured business loans are also available, and borrowers are asked to enclose their tax returns, recent mortgage notes, and bank statements.