What To Consider Before You Apply For An Unsecured Personal Loan

things to consider for a personal loan

What To Consider Before You Apply For An Unsecured Personal Loan

Given that an unsecured personal loan could last up to 60 months in total, it is vitally important to know how the application process works and what to consider before you apply for an unsecured personal loan. We are using the words unsecured personal loan to distinguish it from a shorter term payday or short term loan. For our purposes here an unsecured personal loan and personal loan are the same thing.  

When you apply for a loan with Badger Loans, it will be necessary for you to give some basic details: this includes your name, date of birth, address, monthly income, expenses and bank details. 

How much would you like to borrow?

When deciding on the amount you would like to take out for your unsecured personal loan, you should consider very carefully the amount you need. This is because you need to keep in mind that this will also be the same amount you will need to pay back, plus interest.

In order to help you decide, we advise figuring out exactly how much you need to borrow, for things such as immediate expenses or for things like credit card bills or paying for car repairs. Why not give our affordability calculator a try here.?

How long should I borrow for? 

There is a great deal of flexibility when it comes to unsecured loans: you can borrow for a period of time ranging from 12 to 60 months.

Nevertheless, it is very important to be aware of the fact that the longer the loan duration, the more expensive it will be overall. This is because interest will be added month after month.

Yet, at the same time, a long term loan may better suit your individual circumstances: as it can provide flexibility and it also means in the short-term you will have smaller repayments.

If you can make early repayments, it is worth doing so: as if you can end up saving money, as less interest accumulates.

Do I meet the initial criteria for a personal loan?

The exact criteria can vary from lender-to-lender, but the general eligibility for a personal loan is usually the following:

  • 18 years or over
  • UK resident (full-time)
  • Employed
  • Stable, regular income
  • Valid UK debit account
  • Valid UK email
  • UK mobile phone account
  • Can afford the monthly repayments

 How am I going to repay my personal loan?

In terms of paying back your unsecured personal loan, this is usually in monthly instalments in equal amounts, so that you know exactly what you are paying each month and can budget for it.

You should try to do everything you can to make sure you make prompt repayments: failing to do so means you will incur additional fees, and it can also affect your credit score. If you do have problems with making repayments, it is worth contacting your lender directly as soon as possible so that they can assist you with what to do next.

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