WHAT ARE 12-MONTH LOANS?
12-month loans are a type of short-term loan that has become increasingly popular in recent times. These are designed so as to last for only a year or 12 months to be precise. They are extremely helpful as they help one to accurately budget for the concerned money that they have borrowed as it is known that it must be fully repaid within a year or 12 months. This is the main difference that makes it stand out from other types of short-term loans offered by various direct lenders.
These types of loans allow one to borrow a wide range of different sums of money and these types of loans help break up the borrower’s loan into 12 manageable repayments that must be repaid on a monthly basis. Small loans are a good way of allowing one to budget for anything unexpected.
DESCRIPTION OF 12-MONTH LOANS
The approximate calculated interest for borrowing 100 pounds under such a scheme comes around 13 pounds per month. There are many people who may suffer from bad credit history and there are many lenders available who are willing to provide loans to people who have a bad credit rating and who may have been denied loans elsewhere. Most lenders have eligibility checkers that help check the individual’s likelihood of being fully approved for a 12-month loan for bad credit before applying.
One can improve his or her credit score by being accepted for a 12-month loan and keeping up to date with the necessary repayments for the concerned loan. This makes it easier for the individual to be accepted for any sort of credit in the near future. Missing out on payments has the opposite effect and can damage the borrower’s credit profile making it difficult for him or her to be accepted in the future for bad credit loans.
There are many UK lenders offering 12-month loans with no guarantor as not everyone may have access to that facility. These 12-month loans have become extremely popular in recent years as direct lenders have started offering these types of loans which do not require a guarantor.
GETTING APPROVED FOR A 12 MONTH LOAN
One is eligible for such loans only if he or she is above 18 years of age and is a citizen of the UK. Having a good income source is advantageous but not necessary. One also needs to have a good credit score to increase approval chances for the borrower. Lenders always prefer people with a good credit score as they can be trustworthy and reliable and are more likely to repay back the loan amount in the stipulated 12 months or 1 year.
If the borrower’s credit score is not enough for gaining approval for a 12-month loan, then the borrower can obtain loans by getting into a joint agreement which can be done by convincing a friend or family member to become your guarantor for the 12-month loan. In this case, if the borrower fails to make a repayment to the lender then the guarantor can pay in place of the borrower.
Asset pawning is also a good solution for the concerned individual or borrower. In case he or she is unable to find a guarantor then he or she can pawn any asset which may be a land, property or even a vehicle. This asset should have a value equivalent to the value of the loan.