Loans to Consolidate: One Payment for Several Loans

Before going into the pretext of the loan, we must know what is meant by ‘people on benefit’. While being employed, there may arise certain situations in which an employee works for less than 16 hours a week and this is the specific situation in which the employee is said to be on benefit. The income raised by the employee, in general, proves to be sufficient for their livelihood but no one knows when an adverse situation crops up and there is urgent need of funds, in which loans for people on benefits proves to be a key choice. It usually happens in such a crisis that all the doors are closed which adds to the financial stress on the person.

Loans for People on Benefits: Various Loans Available

Similar to other loans, loans for people on benefits are of various types such as secured, unsecured, budgeting loans, crisis loans etc. Secured loan is a good option to be opted, if you have got property to keep as collateral. The collateral can also be arranged by someone else if he agrees to be a party to the loan. In secured loans for people on benefits, the borrower gets a relaxation in the interest rates.

It is not always so easy to suit the criterion for secured loans, but it might not be a hindrance in the way of having some other loans well suited to you. And here unsecured loan comes to the rescue. The interest rates can be a bit higher but by extending the repayment period, you will be in a much easier situation.

For your day to day urgent requirements, budgeting loan is too available. Though you will get less loan amount, but the lending procedure is quite simple. Crisis loans are also available when it comes to short term requirement. The loan amount is usually not sufficient to suit the financial crisis. But if it satisfies your needs, then surely go for it.

Loans for People on Benefits: Loan amount and Rates

The interest rates normally vary in the range 5% to 9.9%, according to the different loans. The upper limit reflects the higher interest rate in the case of unsecured loans. The typical rate is 7.7% for most of the situations.

Anything between £500 and £250,000 can be borrowed, keeping in mind the repayment period. In case of budgeting and crisis loans, the lending amount is somewhat near to £1000. One of the advantages associated with these loans is the lower rates on which the amount is sanctioned. These loans are either issued by the community centers or some government agencies.

Loans for People on Benefits: Some take cares

One of the pre requisites before going for a loan is to choose the suitable lending agency as the wrong choice may result in your financial exploitation. The other important factor is to evaluate your financial status. And always pre plan the repayment schedule to avoid any unwanted circumstances. In extreme situations you may end up with poor credit rating which will further create problems for other loans.

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