Doorstep Loans Result

A Guide To Doorstep Loans

Sometimes, you may need some extra cash to handle a financial emergency. Perhaps an unexpected expense has come up, such as a car repair or dental bill. Finding quick and easy cash loans for a reasonable interest rate is not always easy, especially for those who have bad credit. Doorstep loans are a new type of loan that are becoming very popular with consumers who need cash fast.

What Is A Doorstep Loan?

A doorstep loan is a type of loan that is provided to you by a lender who comes to your home. These loans are normally for small sums of money, starting at £50 and may go up to £1,000 at most. The loans are given for a short period of time, such as a year, with the repayments being collected on a weekly or fortnightly basis. The lender will actually come to your home to collect the repayments.

How Do These Loans Compare To Other Types of Loans?

Doorstep loans tend to have a much higher interest rate than regular bank loans or credit cards. For example, if you borrowed £200 from a doorstep lender, you would likely pay a higher interest rate than if you had borrowed the money on your credit card which charged a higher than average interest rate.

Secured loans offered by a traditional lender require that you offer collateral for the loan, while no collateral is required for doorstep loans. With unsecured loans, you do not need to offer collateral but the interest may still be higher than a secured loan (but lower than the interest on a doorstep loan.)

Pre paid credit cards are different from doorstep loans because with a pre paid card, you can simply add on the amount of funds that you choose before using the card, whereas with a doorstep loan the lender will simply give you the amount of money you want without prepaying anything.

Are Doorstep Loans Regulated By the Government?

All credit lenders must be authorised by the Financial Conduct Authority (FCA) before they can offer loans. If a lender is not regulated by the FCA, they are acting illegally and can be fined or imprisoned. This will provide some comfort to consumers to know that doorstep lenders are subject to oversight by the Government. The FCA will carefully examine a doorstep lender and their operations to ensure that their activities are legitimate and not merely a scam.

You can check if a person or company is registered with the FCA by searching the FCA register here.

What Should I Do If I’m Approached By A Doorstep Lender?

Doorstep lenders sometimes generate business by going from door to door, similar to a salesman, offering prospective customers information about their products and services. If someone comes to your door offering to lend you money, the first thing you should do is ask to see some proof that they have permission by the FCA to offer loans. If they can’t provide this proof, they are likely to be a loan shark.

You should end the conversation right away and report them to the FCA. Legally, lenders should not come to your home uninvited to offer you a loan. They must have written permission to visit your home. This also applies if you already have a loan and the lender offers you another loan while visiting you to collect repayments. They must arrange a separate visit for discussing the details of a new loan before signing you up.

This gives you some time to change your mind about the loan without feeling pressured by the lender. In addition, if the lender does visit you on a separate occasion to offer a new loan, you are allowed to change your mind and ask them to leave at any time. Ultimately, it is up to you whether or not you decide to take a new loan.

I Submitted An Application For A Loan. Am I Obligated To Take It?

No, you are not obligated to take the loan. Submitting an application is merely stating that you wish for the lender to consider and approve the application, and to contact you to discuss your loan options. During this time, you are free to ask questions if you are unsure about anything.

You may withdraw your request for a loan if you decide that you are not comfortable with it. However, if you are ready to proceed with the loan, you must officially agree to the terms of the loan with the lender. You then become obligated to repay whatever money you borrowed along with the agreed interest.

When Will the Lender Come To Collect Repayments?

The lender will come to your home to collect the repayments at a mutually agreed time that is convenient for you. When finalising the loan, you can arrange a time with your lender to collect the weekly or biweekly repayments. If you need to change the date or time of the payment collection you can do this by contacting the lender. As mentioned, the lender cannot come to your home unless you have given them permission to do so.

What Happens If I Miss A Payment?

You should carefully read the terms of your loan agreement to ascertain whether there is a late fee or penalty for missing a repayment. In most cases, you will not be charged for missing a repayment, but you should contact the lender to discuss how you can avoid missed payments in the future. If you are missing payments frequently, the lender will discuss your account history with you and try to work out a solution for paying back the debt.

Financial Help

While you may be tempted to accept an offer from a doorstep lender, you should think it through carefully first. You may feel frustrated because you have bills that you can’t pay, but don’t rush into a decision. Remember that borrowing money at a high rate of interest may add to your financial problems. If you are struggling to pay bills or meet your financial commitments, get help from a debt advice service.

The National Debtline is a free telephone helpline that aims to help people who have debt problems. It is open to anyone living in England, Wales or Scotland. This is a free and confidential service that may help you get out of debt. The number is 0808 808 4000. Alternatively you can reach them online at nationaldebtline.org

The Money Advice Service is an independent service created by the government to help people manage their money better. They provide free, unbiased advice about credits cards, loans and how to handle debt. You can reach them at 0300 500 5000 or through their website at moneyadviceservice.org.uk.

Conclusion

Only you can decide is a doorstep loan is right for you. If you are feeling financially strained, don’t rush into a decision or take out a loan in haste. You need to know what all of your options are. Do your research and make sure that you are fully informed about the terms of the loan before signing a contract. If you have any doubts about a lender, contact the FCA with any questions you may have.

Compare Doorstep Loans

A Guide To Doorstep Loans

Sometimes, you may need some extra cash to handle a financial emergency. Perhaps an unexpected expense has come up, such as a car repair or dental bill. Finding quick and easy cash loans for a reasonable interest rate is not always easy, especially for those who have bad credit.

Doorstep loans are a new type of loan that are becoming very popular with consumers who need cash fast.

What Is A Doorstep Loan?

A doorstep loan is a type of loan that is provided to you by a lender who comes to your home. These loans are normally for small sums of money, starting at £50 and may go up to £1,000 at most.

The loans are given for a short period of time, such as a year, with the repayments being collected on a weekly or fortnightly basis. The lender will actually come to your home to collect the repayments.

How Do These Loans Compare To Other Types of Loans?

Doorstep loans tend to have a much higher interest rate than regular bank loans or credit cards.

For example, if you borrowed £200 from a doorstep lender, you would likely pay a higher interest rate than if you had borrowed the money on your credit card which charged a higher than average interest rate.

Secured loans offered by a traditional lender require that you offer collateral for the loan, while no collateral is required for doorstep loans.

With unsecured loans, you do not need to offer collateral but the interest may still be higher than a secured loan (but lower than the interest on a doorstep loan.)

Pre paid credit cards are different from doorstep loans because with a pre paid card, you can simply add on the amount of funds that you choose before using the card, whereas with a doorstep loan the lender will simply give you the amount of money you want without prepaying anything.

Are Doorstep Loans Regulated By the Government?

All credit lenders must be authorised by the Financial Conduct Authority (FCA) before they can offer loans. If a lender is not regulated by the FCA, they are acting illegally and can be fined or imprisoned.

This will provide some comfort to consumers to know that doorstep lenders are subject to oversight by the Government.

The FCA will carefully examine a doorstep lender and their operations to ensure that their activities are legitimate and not merely a scam.

You can check if a person or company is registered with the FCA by searching the FCA register here.

What Should I Do If I’m Approached By A Doorstep Lender?

Doorstep lenders sometimes generate business by going from door to door, similar to a salesman, offering prospective customers information about their products and services.

If someone comes to your door offering to lend you money, the first thing you should do is ask to see some proof that they have permission by the FCA to offer loans. If they can’t provide this proof, they are likely to be a loan shark.

You should end the conversation right away and report them to the FCA. Legally, lenders should not come to your home uninvited to offer you a loan. They must have written permission to visit your home.

This also applies if you already have a loan and the lender offers you another loan while visiting you to collect repayments.

They must arrange a separate visit for discussing the details of a new loan before signing you up.

This gives you some time to change your mind about the loan without feeling pressured by the lender. In addition, if the lender does visit you on a separate occasion to offer a new loan, you are allowed to change your mind and ask them to leave at any time.

Ultimately, it is up to you whether or not you decide to take a new loan.

I Submitted An Application For A Loan. Am I Obligated To Take It?

No, you are not obligated to take the loan. Submitting an application is merely stating that you wish for the lender to consider and approve the application, and to contact you to discuss your loan options.

During this time, you are free to ask questions if you are unsure about anything.

You may withdraw your request for a loan if you decide that you are not comfortable with it. However, if you are ready to proceed with the loan, you must officially agree to the terms of the loan with the lender.

You then become obligated to repay whatever money you borrowed along with the agreed interest.

When Will the Lender Come To Collect Repayments?

The lender will come to your home to collect the repayments at a mutually agreed time that is convenient for you. When finalising the loan, you can arrange a time with your lender to collect the weekly or biweekly repayments.

If you need to change the date or time of the payment collection you can do this by contacting the lender.

As mentioned, the lender cannot come to your home unless you have given them permission to do so.

What Happens If I Miss A Payment?

You should carefully read the terms of your loan agreement to ascertain whether there is a late fee or penalty for missing a repayment.

In most cases, you will not be charged for missing a repayment, but you should contact the lender to discuss how you can avoid missed payments in the future.

If you are missing payments frequently, the lender will discuss your account history with you and try to work out a solution for paying back the debt.

Financial Help

While you may be tempted to accept an offer from a doorstep lender, you should think it through carefully first.

You may feel frustrated because you have bills that you can’t pay, but don’t rush into a decision. Remember that borrowing money at a high rate of interest may add to your financial problems.

If you are struggling to pay bills or meet your financial commitments, get help from a debt advice service.

The National Debtline is a free telephone helpline that aims to help people who have debt problems. It is open to anyone living in England, Wales or Scotland. This is a free and confidential service that may help you get out of debt. The number is 0808 808 4000.

Alternatively you can reach them online at nationaldebtline.org

The Money Advice Service is an independent service created by the government to help people manage their money better.

They provide free, unbiased advice about credits cards, loans and how to handle debt. You can reach them at 0300 500 5000 or through their website at moneyadviceservice.org.uk.

Conclusion

Only you can decide is a doorstep loan is right for you. If you are feeling financially strained, don’t rush into a decision or take out a loan in haste. You need to know what all of your options are.

Do your research and make sure that you are fully informed about the terms of the loan before signing a contract. If you have any doubts about a lender, contact the FCA with any questions you may have.

Family or Friends, Who Should You Borrow From?

When you need money, the first thing that may come into your mind is to ask your friends or relatives. However, you must weigh carefully about whether you can manage to return it and can deal with what might follow if you cannot.

Pros and cons of loaning from family and friends

Asking your family may be the easiest way to borrow money. They can give emergency cash and help you dodge borrowing with extremely high-interest rates, such as doorstep lending, bank loans, and payday loans.

If both parties are confident it will not destroy a relationship with a family member if you cannot pay back, this is the best choice as it is usually free of interest.

If you are borrowing from a friend, be conscious that if you do not return the money, this could end your relationship with your friend.

Work out a budget ahead

If you want to ask a family member or a friend, make sure you have drafted up a budget to see how much cash you have left after clearing your living expenses.

Look at your current-account and credit-card records from the last three months, and think carefully how much you can borrow.

What if you cannot repay?

It can be stressful if you cannot manage repayments, but it can be even worse if you are leaving a someone out of budget as it might endanger your relationship.

That is why it is necessary to form out your budget and create a new payment plan as soon as you see yourself in distress.

The first thing you may need to do is to let them know what’s happening to show them that you are an honest person and that paying them is your primary concern.

Here are some other tips that will assist you if you are coping with debt:

Other ways of borrowing money

If you are unsure whether or not you should loan from a family member or a friend, there are other alternatives even if you have a bad credit standing.

See: The UK’s Top Debt Solution Providers

Things consider before lending money to friends or family

If someone asks for financial help, especially if it is a family member or a friend, it can be difficult to decline.

However, there is no point going into hardships yourself because you want to help, or because you feel sorry for not helping. On the other hand, maybe you cannot afford to sacrifice your relationship with them just because of money.

Can you afford it?

Work out your budget before lending to anyone. Consider everything you lend as gone. Be sure that even if someone cannot repay you, you would still be able to pay all your living expenses comfortably without borrowing from anyone.

Can they afford it?

Encourage the would-be borrower to draft out their budget, just like what you would be doing. Remember that if they cannot repay you, this may cause financial trouble for yourself or worse, your relationship with them

What will you do if the borrower cannot pay?

You might be certain the person you have lent funds to will be capable of paying it back in full, but you must study what you will do if they cannot; this is a very personal decision, so take your time and think about this.

How formal should it be?

Always keep in mind that whatever you or the would-be borrower says can be denied. Get something in writing when you are lending to family members. Do not be embarrassed by this as this is very common.

Know that if you lend money to family and friends on a regular basis, you might need to be documented by the Financial Conduct Authority (FCA).

In case the borrower died with an outstanding debt, having a formal contract can protect you. Contracts can be used as a proof to claim from their estate.