Small Loans for students

Small Loans for Students

Small loans for students is a saviour for students who are in urgent need of some extra cash. Small loans are basically short-term low-value loans, which help to fix financial situations. This loan was designed to help people who were in a financial emergency. The emergency could have been anything, phone bill, house repairs, car repairs, etc.
Students before were seen as candidates not worthy to lend a loan to, but now many lenders have changed their perspective towards them. Considering their needs lenders are now providing small loans to students specially designed for them.
However, like any other loans, students also need to provide certain information regarding their educational and financial status. The application is then verified and reviewed by the lenders taking into account your circumstances as a student.

student-small-loans

How Much Can a Student Borrow and for How Long?

The short-term small loans provided to students are similar to that of any other small loan. That means the amount that a student and an employed citizen can borrow is same. Though the amount range is same for both of them, the actual amount varies depending on your credit history.
Students can get a small loan for a sum of £1,000. The repayment of the same has to be done in one month. There are exceptions in certain cases, lenders provide you a loan which fits you and which you can repay comfortably.

 

Things to Consider Before Going for a Small Loan

  • Higher Interest rates

As this loans are of low value and short period, the interest rates are high compared to the other loans. Students should go for small loans only if they are in urgent need of it and they have considered every other method to get money just to come up with no result.

 

  • Credit history

The credit history depends on how you make the repayments. If you make the repayments on time, you would get a good credit score which would give you a good credit rating. This will help you in future to get a loan, as the lender would see that you have done repayments on time on your previous loans.
If you miss your repayments, the situation will be completely opposite. Not making payments on time will have a negative effect on your credit history. However, there are loans for people with bad credit but one must avoid having a bad credit history.

 

Read more:
Small Loans for Bad Credit Direct Lender

Debt Consolidation

Debt Consolidation

Debt consolidation means taking out a large loan to pay out a number of loans, consumer debts, bills. Doing this brings all these debts together into one combined loan which you pay off with a lower rate of interest. With this, the borrower finds it easy to pay off his terms with lower monthly payments than before. As we are combining all the loans together into one, this refers to “consolidating” them. That’s why it is termed as debt consolidation loan.

Technically it is impossible to combine all loans and merge them together. Every loan has its own repayment terms and rate of interest. Each loan has an agreement where you pay it back in set payments over a period of time. So to consolidate debts, you actually get a larger new loan and you use the money from it to pay off the loans you wish to combine. Debt consolidation loans are used by people to combine small loans, bills, credit card balances, overdraft balances and payday loans.

debt consolidation loan

Finance Companies and Banks issues Debt consolidation loans. There are additionally some debt repayment programs that can help to consolidate all the debt payment in a single payment for individuals who are finding it difficult to pay off their debts.

Reasons Why People Go For Debt Consolidation Loans

Reasons to get a debt consolidation loan may vary from people to people.

Some of the reasons can be:

  • It eases our finances by minimizing our many debts payment into one, which is easier to track than a number of loans that we had.
  • It helps by lowering the rate of interest. As all of your smaller loans are combined into one large loan, the rate of interest with which you make repayments is also reduced.
  • It makes our life much simpler by reducing the monthly repayment amount, this is possible only if you get a lower rate of interest on the consolidated loan
  • Debt consolidation loans help you to maintain a decent credit score, it helps your credit score positively.
  • You can pay your debts faster if you manage to get a low-interest rate on your debt. Getting a lower rate of interest depends upon your credit history.

 

You should go for a debt consolidation loan only if you are confident enough to make the repayments. If failing to do so it might harm your credit history. Also, which might have a negative effect in the future when you apply for a loan.

 

Read more:
Bad Credit Loans