Guaranteed Personal Loans
Some firms promise the earth – but beware hefty APRs
Guaranteed personal loans really do exist: some firms promise to lend money to almost anybody, no matter how much of a financial disaster they may be (although if you've been convicted of fraud, your chances of borrowing from anyone are pretty slim). However, beware hefty APRs.
Guaranteed personal loans are widely available from the large number of firms who will lend money to almost anyone who applies (although even the most generous lenders tend to shy away from convicted fraudsters and people who have been through bankruptcy proceedings). However such loans are often very expensive, and if you've been refused by mainstream lenders it's important to ask why. If the lenders decided you can't afford to repay the loan, they might be right – and if they are, looking for a more expensive loan is financial suicide.
As a rule, the riskier the borrower the more expensive the borrowing will be. Beware weasel words such as "rates as low as" or "rates from only" – if you're a bad borrowing risk or you're borrowing less than £5,000, you probably won't be offered the same interest rates shown in the headlines.
Watch out for sneaky advertising tactics, too: some firms publish what seem to be reasonable repayment rates, but if you look at the small print the APR is sky-high. Remember: when you compare guaranteed personal loans from different lenders the APR is the only figure that matters.
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