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Representative example: £500 borrowed for 90 days. Total amount repayable is £672.60. Interest charged is £172.60, interest rate 140.0% (variable).
Doorstep loans, also known as home collected personal loans have existed for a long time. They are a popular option for people who prefer the convenience of completing the loan process and making their payments from the comfort of their homes. These loans are largely similar to the other types of personal loans. The main difference is that instead of the borrower going to the lender, they are actually delivered to his or her doorstep.
Meeting with an agent face to face is certainly an advantage because it gives you the perfect opportunity to discuss your financial circumstances and credit needs with a person who is sufficiently knowledgeable in loan matters. At the same time, since the agent is responsible for collecting the repayments makes it easy for you to manage the loan.
Basically, an agent will come to your door and explain everything pertaining to the loan. If you come to an agreement, all the paperwork will be completed there and then. The same agent with whom you complete the paperwork will be the one tasked with collecting the payments and responding to any queries that you may have.
It’s very important to ensure that the lender you’re dealing with is actually authorized. If someone is reluctant to show their proof of authorization, you should probably try different options. The last thing you want is to fall prey to the tricks of an illegal lender.
With loans to your door, the interest rate is fixed for the duration of the loan. That makes it easy for you to work out how much you can be able to repay in weekly instalments. In most cases, the loan amount is fairly small and the lender will do a credit check on the applicant.
Doorstep loans are mainly used to handle emergency expenses or carry the borrower over to his or her next paycheque. The personal service that comes with the loans is one of the reasons the interest rates are a bit higher compared to other types of loans. You don’t even require a bank account in order to get a doorstep loan.
If you are facing an emergency and your lending options are limited due to bad credit, you can still apply for a doorstep loan. Since not all lenders offer doorstep loans to people with bad credit, you may want to ask about this ahead of time.
Before delivering any loans to your door, the agent will require you to provide him or her with your proof of identification, income and address. How much will be given to you will depend on your income and how much you can afford to pay weekly.
The fact that you don’t have to visit the lender in order to complete the process is a huge benefit for elderly citizens or persons with disabilities. Also if your time is limited, this type of loan may be the best option for you.
As soon as the lender checks your proof of ID and income, the application will be approved and the funds delivered to you. This is not the case with traditional loans which take a significant amount of time to get approved. With loans to your door, the process is simplified and most of the work is done by the agent.
3.Money is delivered in cash
Having cash brought all the way to your house will make it possible for you to start spending the money right away. Also, since someone else carries the cash means that you are not under risk of losing the money along the way.
4.They can help you build credit
If you have a poor credit score, doorstep loans can help you elevate it to a more desirable level. This will depend on your ability to repay the loans in time over a period of time.
A doorstep loan is different from a traditional loan in a number of ways. In short, it is a loan that comes to you instead of you having to go and get it. In order to reap all the benefits of this type of loan, you must try your best to manage it well any time you take it.