Quick loans are small loans that come in handy when you are caught off guard by emergencies. Despite savings, you may fall short of cash to bear the unexpected expense. You can easily qualify for these loans as the processing takes a few minutes. You will most likely get money the same day you put in the application.
These loans are aimed at subprime borrowers, so a bad credit rating will not get in your way of qualifying for the loan, but it does not mean that there is a guarantee that you will get signed off on. It depends on your lender’s policy that what score they treat as a bare minimum to give the nod to your application. Not to mention, you will be turned down even if you meet that requirement if you cannot afford to repay the debt.
An affordability check is a must whether you are borrowing a small sum or a large sum. This includes your credit score check and repaying capacity. In case of a lack of poor repaying capacity, some people try to arrange a guarantor with a good credit rating so they can get approval for the loan.
Quick loans typically do not require a guarantor
Quick loans are minuscule loans. The maximum amount you can borrow through these loans is up to €500, depending on your repaying capacity. There are very few lenders who are flexible and liberal with their lending policy and are willing to loan you up to €1,000.
As these loans are already aimed at subprime borrowers, a lender will not ask you to arrange a guarantor. However, if your credit score is lower than the bare minimum, you will be straightaway refused the loan. If you are offered, you will get it at a very high-interest rate.
Since you do not need to arrange a guarantor, these loans are also called quick loans in Ireland with no guarantor. A guarantor is normally required when you are borrowing a larger sum to be repaid over a period of months.
As the money is so small, the whole payment is made in full on the due date. The repayment length is not more than 15 days. Rarely, it touches a month. If you are looking to avail of lower interest rates, you should seek other ways such as:
- Do proper research
Each lender has its own method to gauge the risk involved in lending you. They will charge higher interest rates when they find that the risk is very high. It is likely that one lender offers comparatively lower interest rates than others. Therefore, it is crucial to research the rates in advance.
Make sure you check the APR. This will be higher than the interest rates because of processing fees, loan origination fees and the like. You can get all these details from the websites of lenders. Go to the comparison websites as well to check which lender is more affordable.
- Have a strong repaying capacity
Even though your credit rating is poor, you can avail yourself of lower interest rates by proving a strong repaying capacity. As you know, your lender will turn you down if you find that you cannot afford to pay back despite a good credit score; you should not ignore its importance.
You will be considered a responsible borrower. A lender will consider you a less default borrower, and you will probably get money at the best interest rates.
Beware of loan sharks
Quick loans in Ireland are available from various lenders. Further, they are very easy to apply for. You just need to fill in the application form online, and the money will be transferred to your bank account the same day. They do not require any formality like arranging a guarantor and putting down collateral. Since these loans are very easy to access, chances are you get trapped in a loan shark.
Private loan sharks in Ireland are unregistered lenders that lend money in order to trap credulous customers into a debt trap. They target subprime borrowers who cannot get the nod from banks and other exalted financial institutions. They charge extortionate interest rates to make money. The interest rates could be so high that you will end up rolling over the loan, and eventually you will find that you have fallen into a debt trap.
Loans sharks treat themselves above the law. They do not follow the regulated rules and do not mind lending you money against your interests. They emphasise only their profits. If you fail to make a default, they can start threatening you and put too much pressure on recovering your money.
Well, it is not tough to detect loan scammers. You can easily avoid getting trapped in their extortionate offers with the following tips:
- You should check their address on their websites. Make sure you can reach that place.
- Find out if they have mentioned their registered number. If not, they are unethical.
- Find information about a loan product and if you find that it is too good to believe you should not trust the lender.
You do not need to worry if you have taken out a loan from a loan shark. You can make a complaint. Further, they are unregistered, so you do not need to fulfil the obligation to clear the dues.
The bottom line
You do not need a guarantor when you need a quick loan with a bad credit score, but you should still be careful. These loans can be expensive. Make sure you borrow money only when you are in dire need of money. Beware of loan sharks as well. Experts suggest that you check the credibility and reputation of lenders, too, before applying for any loan.