In UK personal loan among the masses is in huge demand. The personal loan helps to turn your dreams into reality. As the name suggests personal loan is a loan taken for personal reasons. And the best part about the personal loan is that you do not have to reveal the reason for which you’re taking the loan, not even to the bank or financial institutions offering you personal loan. A personal loan could be of varied reasons like marriage, honeymoon, purchasing luxurious items etc. The repayment of personal loan varies from minimum 1 month to 7 years or as per the terms of the contract. There are many companies offering online personal loans UK.
The best thing about a personal loan is that you do not need to have a guarantor for the loan. Many institutions also offer loan to people with bad credit. There are two documents which you need to show to avail personal loan.
1. Pan card/driving license or passport as proof of identity
2. Electricity bill/house tax bill/ telephone bill, bank statement for proof of address of the house.
Types of personal loan
1. Car finance personal loan: if you’re in urgent need of a car or wish to have the latest model of the car, then you can avail car finance personal loan. This loan is a boon for those who live in a rural area, where public transport is scarce.
2. Home improvement personal loan: if you wish to repair your home, or want to have latest design furniture, you can avail this loan. By taking this loan, you can add value to your house. You can also build multiple stories with the help of this loan.
3. Debt consolidation personal loan: when you take a loan to pay off other installments of other loans, it is called debt consolidation. You can take a personal loan to pay off every other installment. However, it is advisable to seek debt counselor advice before consolidating your debt.
Types of interest rates on personal loan
The terms upon which you will receive loan will depend a lot upon your credit score. Some financial institutions offer instant personal loan but these loans generally have a high rate of interest. A person with bad credit history may get a personal loan at the high-interest rate. Generally speaking there are two kinds of interest rates: a fixed interest rate is the one whose interest rate remains the same throughout the loan period. A variable interest rate remains to change depending upon the market situation. It is advisable to take the personal loan on a fixed interest rate.