Bad credit score, unemployment, short term disability, or some other hassles…credit are available in the UK for all. However, not all of us qualify for loans and financial aid being offered by conventional lenders and government agencies. Thousands of UK residents look for private credit solutions to meet their financial shortages.
A doorstep loan is one of the popular choices among those who need short cash loans to meet temporary cash lapses. As the name suggests doorstep loans are available as home credit. The loan agent visits your home and hands over cash at your door. These are convenient loans for those who are undergoing a rough phase in life.
However, the convenience of doorstep loans comes at an extended cost just like payday loans. If you compare APR % of doorstep loans it is more than most of the credit cards. Herein, it is interesting to find out why despite such a high rate doorstep loans are popular among UK households.
Why doorstep loans are popular?
• Unlike payday loans, doorstep loans are installment loans which are collected weekly or fortnightly.
• You can avail a doorstep loan despite your past credit history.
• There is no legwork involved. The loan agent does all R&D for you.
• The interview with loan agent is meant to determine your willingness to repay loans. It is not a decider to approve a loan.
• You avail loan without affecting your self-worth.
• The reimbursement plan is also discussed before allocating the loan. So you can pay according to your financial ease.
Who opts for doorstep loans?
1. Those struggling with bad credit history – When you already have too many loans and high debt ratio, it is difficult to search for a lender who would be willing to offer a loan. With too many debts and bad credit history, doorstep loans could be the only financial aid you could receive at this moment.
2. Unemployed people – As credit health is not a criterion for approving doorstep loan, unemployed people also opt for doorstep loans. The loan agents for doorstep loans are financial experts who are open for special delayed repayment arrangements. With the loss of job, any kind of respite from the loan instalment is a welcome feature of doorstep loans for unemployed people.
3. Health Issue – Whether you or a loved one is medically unfit, or bound to home due to medical issues you can raise easy funds to face the emergency. The ease of repayment helps you afford the loan despite the personal problem.
4. Home bound – Many stays at home moms or those who are partially employed also use doorstep loans to meet the uncalled for expenses. As the loans are processed from their home it minimally disrupts their daily routine and offers timely financial help.
5 Bridge loans – The doorstep loans could be conveniently used as bridge loans to meet a cash gap. Being expensive loans you should keep the amount of loan short and that too for a few weeks. This way APR% would not bother you when you avail a loan.
6. Loans for all – While people with bad credit can avail doorstep loans with ease, it would not be wise to term these loans as bad credit loans. Anyone who needs the short loan for a short period can opt for doorstep loans.
7. An emergency loan with ease of repayment – Those who need fast emergency loans also opt for doorstep loans. However, these are not as swift as payday loans but the ease of repayment makes them a better choice among the borrowers.
Things to keep in mind
Online borrowing is the quickest mode of availing loans. Right at your home or office, you can apply for the loan and wait for approval. Most of the approvals are swift and you can even avail same day loans. Here is a quick checklist to be followed before agreeing upon a doorstep loan agreement.
1. Check for credentials of the finance company
Always deal with an FCA authorised loan company. According to FCA guidelines, no loan agent can contact you out of the blue. The first contact needs to be initiated by the borrower. You can consider contacting a loan broker regulated by FCA and share your credit requirements.
2. Check for FCA registration
Ensure that you check for FCA registration number and local address on their website. By contacting a loan broker, the responsibility to search for a lender is rested on the shoulders of a broker. You just need to choose from the available loans.
3. Share your credit requirements clearly
When a broker contacts you and connects you with a loan agent for doorstep loan, it is essential to share your credit requirements in detail. You need not hesitate to share your needs as the loan agents are already open to help the people with credit issues.
Always have a clear discussion regarding the loan repayment. You should settle down with an affordable repayment plan. The agent would visit you for collections as promised. By repaying your loan on time you would improve your credibility.