Oh, only God can save from incorrect information and perception. Both are dangerous and destructive. In one word, you can collectively call them ‘myth’. Wherever in your life, this word intrudes, only misconception comes in the picture. It shows its worst form in financial life, which affects all the decisions of life.
When it comes to financial products, loans are quite prone to myths and that in turn affects your decision. As the short-term needs are more often things, their prime solution short-term loans become the victim of wrong information. This, in any case, is sure to affect you. In fact, myths keep travelling from one place to the other leaving the bad effect behind.
Myth = Short-term loans are for only good credit scorers
It is true that credit score is an important factor that every lender considers. Having a good credit rating is always good, but in case you have a poor credit score, situation is not impossible. Especially, in online lending, it is not an issue as the lending companies provide specialised loan products for bad credit scorers. In short, you can get short-term loans for bad credit without any mess and stress on this matter.
Myth = First-time borrowers cannot borrow funds
Who said that? This is not true. Everything you do for first time in life than how the finance world can avoid this established logic. Without any second thought on this aspect, apply for the short-term loans and borrow without any search footprint as ‘no credit check’ is one of the prime features of the online finance market. No credit check is the simplified term for a soft credit check in which the lender replaces the need of credit score perusal with the information like employment details, bank statement.
Myth – Interest rates are very high
Are you serious? Haven’t you heard the word ‘customisation’? This feature is equally applicable in the case of financial products. The loan deal is customised according to your affordability and that brings down the interest rates. This in turn, in fact, keeps the instalments small and manageable. With your good credit rating, get a promising relaxation. However, if you have poor credit scores but improving in recent financial behaviour, the chances to get lower rates are bright.
Myth = There is a decided minimum and maximum limit to borrow
How it can be possible with lending companies in abundance in the loan market? This may happen in the case of mainstream lending as Bank of England affects their lending policies. But, online lenders are comparatively free from generalised rules and guidelines. They decide the minimum and maximum according to their own capacity to take a risk on their money. Generally, this is minimum £500 and maximum £5000 but this is not the only category. You can surely find versatility in this concern. Besides, the affordability of the applicant decides the loan amount that he/she can qualify for. May be the maximum limit of a lender is big but your financial capacity on repayments is not such that can afford the amount. You get only what you can payback.
Myth = The approval rate is quite low
No, the finance companies in fact try to provide funds to as much people as possible. In fact, some have an approval rate of 97% to 99%. Try to understand the logic. When applicants are accepted beyond credit rating constraint then how the approval rate can be low? Apply and see the reality from your own eyes. Some lenders may have stringent policies but majority of the market is lenient and reliable in this concern. However, if you are talking about availing funds with worst credit rating, CCJ, bankruptcy, oops! You need to find an option precisely for very bad credit scorers.
You know what, the best way to avoid myths is to explore things on your own. Today internet is available everywhere. Use it and do deep research and lastly try things. Experience is the best tool to remove myths and they make you mature enough to avoid the destructive distractions.
How can you take important financial decisions on what ‘people are talking’ and not what is actually correct? Change your thinking and develop the maturity to see the other side of the coin. Life is better when it is lived on self-relying rules and most importantly logic.