Q: If I want to borrow money isn’t it just easier to use the credit card in my wallet?
A: It may be convenient but it will be a lot more expensive in terms of the interest rate and if you want to make a large purchase you may reach your credit card credit limit.
Q: I want to borrow £5000 but I need to know the exact monthly amount to pay back so I know I can afford it. What if interest rates rise?
A: If you get a fixed rate loan then the rate stays the same no matter whether the Bank of England interest rates go up or down. You'll be able to know exactly what your repayments will be every month.
Q: I am not a home owner but will I be able to get an unsecured loan?
A: Not in every case. Many loan companies insist on customers being a home owner even if they are not using their home as security on the loan. It's another way that they see to reduce the risk
Q: Can I use a loan to pay off another loan?
A: Loan companies don't usually have restrictions on what the loan is for and they can generally be used for consolidation of other loans but you should pay careful attention to the rate you are getting and any early repayment penalties of your initial loans.
Q: When I worked out how much my new car was going to cost over the whole time with a car dealer's credit it was too much. Could I use a cheaper loan?
A: You can certainly get a loan to cover the cost, but whether the dealer will give you exactly the same deal on the car is up to them.
Q: I am not a homeowner, will I still be able to get a loan for a car?
A: Yes. Some car loans use the car as security rather than your home.
Q: I don't want to risk my house for a loan. Can I still get one?
A: Yes, you would need to compare unsecured loans but it will depend on other factors such as your credit rating. The rates for unsecured loans will be higher so if you are not willing to risk your home you will have to pay more for the same amount of loan.
Q: Will my mortgage company allow me to put up my house as security on a loan?
A: You should always check your mortgage conditions before using you house as security but in general if you default and the house is taken and sold the mortgage company gets priority on their money before the loan company.