What does a £500 loan mean?
In order to remedy a financial emergency, you may need to avail a £500 loan. These loans are short-term loans specifically designed to help you take care of unanticipated expenses. It is advisable to apply for this loan only if your financial situation demands it.
What is the £500 loan usually used for?
There are generally no restrictions on the borrower’s usage of this loan. However, it is strongly recommended that you use this only to resolve a financial emergency. The £500 loan is generally used by individuals for emergencies and daily expenses.
Mentioned below are a few examples of where this loan is usually used.
Paying for emergency private medical bills
Renovations at home
Maintenance costs for vehicles such as your motorcycle or car used every day
Is it possible for you to get a £500 loan with a low credit score?
There are many people who have a poor credit score and hence, get rejected by many lenders while applying for a loan. However, today, there are several lenders who specialize in providing you a short term £500 loan despite your poor credit history. Read these tips to learn about how you can get out of your debt in simple steps.
Moreover, there are multiple credit suppliers who also offer the same online. You get instant access to money. The process becomes a lot easier, faster and convenient as you do not have to visit your bank. However, there is no guarantee online that you will be approved for a loan as your credit history will be checked first.
How can we get a £500 loan?
Obtaining a £500 loan is easy in comparison to the other loans. This is because its application process is relatively simple and straightforward. There are some companies that offer this loan as a direct lender.
This implies that when you take a loan, you are borrowing money directly from the company, which means that there is a single point of contact throughout the process of the loan. Moreover, a guarantor is also not required, which renders the process very simple and effective.
Criteria to be fulfilled
In order to qualify for the loan, there are certain criteria that must be met. These are as follows:
The applicant should be a citizen of UK
The applicant should be over the age of 18
The applicant must be employed i.e. must have a bank account where income is being received on a regular basis
The applicant should not be anticipating or dealing with bankruptcy and other legal proceedings
A valid email address and mobile phone
Some companies may have other specific criteria as well. The above-mentioned points are just to give a general idea of the £500 loan.
Transparency on the part of the lender is paramount. How much the loan will cost and the interest that you will be liable to pay each month should be clearly specified. These £500 loans are referred to as ‘high-cost short term loans’ because they are generally more expensive than the other loans and are lent for a short period of about six months. This is the primary demerit of these loans.
Check early repayment terms
This is a significant aspect to consider while applying for a £500 loan. Usually, most people who go for a loan like this are able to repay the whole loan or a part of it well before time. This way, they are able to save money on interest. You could do the same when you apply for this loan.
Applying for the loan
Applying in store
The rejection or approval of your loan request is usually slower than the online application. However, the advantage, in this case, is that the credit suppliers generally tend to be a little more comfortable lending you money. Be sure to take printed copies of the documents required as proof as mentioned above.
For most people, applying online for this type of loan is the quickest method and most preferred. There are a few simple questions that most companies ask. These questions help the company determine your creditworthiness financial reliability to ensure that you are a suitable candidate for the £500 loan. The details that are to be mandatorily answered are as follows.
Information about employment
Pre-tax monthly earning
The lenders use the continuous payment authority system. Normally, this online application takes about five minutes of your time. Also, you will even get to know if you are approved for the loan or not in that much time.
In case you are not approved for the loan after the application
If you are rejected by one lender for the £500 loan, then i is recommended that you do not send a new application to multiple lenders during this time. This could reflect badly in your credit report and the lenders might be concerned regarding the same. However, the £500 loan usually works in your favor because many lenders do not look at your credit history and instead focus on affordability.
Is it a good idea to take this loan?
Despite being able to yield fast and easy credit for the short term, these loans generally tend to be infeasible. The high-interest rates and the fact that they may not hold up well for long periods are two important factors to keep in mind. They should be considered your last resort.