While guarantor loans are cheaper than other types of personal loans for people with bad credit, experts would suggest for you to consider other alternatives before settling with guarantor loans asyour financing of choice. What they mean is that when banks turn you down, it might be more advantageous on your end if you check out alternatives first. If you don't need the money right away, below are some sources of funding that are cheaper in terms of interest rate.
You'll have better luck borrowing a considerable sum of money at a much lower interest rate with credit unions. If you're a member of one, this should be the first place you should for a personal loan. In general, credit unions offer loan amounts up to £2000 or more depending on your union's terms and conditions. The typical interest rate with this type of personal loan is below 10%. Compared with guarantor loans, you'll save up to 40% in interest.Click here for more info on how to borrow from credit unions.
If you need quick cash for overdue bills or whatever expense you need addressed, borrowing through a peer-to-peer lending scheme is a great way to obtain funding. With this type of lending, individuals online may lend you money up to a couple thousands of sterling pounds. That means, you don't have to go through an intermediary in order to get the money. Without the middleman, the interest rate is also lower and usually dependent on your agreement with your individual lender.
Credit cards may already have a bad rap among customers for their sneaky interest rate computation but they may also be cheaper than personal loans online if you know where to look and how to use it. If you've ran out of cash, you may use the credit card to cover for your basic expenses at least for now. New credit cards will allow you free of interest spending for up to 1 month in general. But just make sure, you pay off the credit on time to avoid skyrocketing interest rates in the end.
If you just need £500 or less, borrowing from family or friends may be a better option than guarantor loans and similar types of personal loans. With family or friends, you might not even pay for interest anymore. Just make sure you return the money on the date promised to steer clear from complications.