Which is the best place to obtain Loans for People on Benefits?
Perhaps the toughest phase of your life is losing a full-time or stable income or facing any physical disability. You cannot live with freedom and future security. Instead, you have to keep patience for the good times to come. However, the government is there to help you by providing certain benefits.
In fact, receiving benefits can be the most significant relief that one can get in such tough circumstances. You do not have to rely on anyone to fulfil your financial goals or manage emergencies.
Everything has a limit. You can use government benefits, but they are insufficient to manage every expense. At some point in time, you will realise the need for extra funding. Where to arrange that money? There is nothing to go anywhere.
You should start exploring the UK marketplace because you will have credible deals available on loans for people on benefits from direct lenders. These loans are in trend because people are struggling with stability in their income. They are receiving benefits, but loans are coming as the final destination due to their insufficiency.
These are small personal loans dedicated especially for those individuals who are unemployed or facing any kind of physical disability. The direct lending marketplace has plenty of deals for them available primarily online.
Reasons Why Direct Lenders are the Best to Offer Loans for People on Benefits
You may question why only direct lenders get these on-benefit loans. It is correct to ask, but there are many reasons to support it. In the given lines below, we will discuss in detail those particular reasons.
- Online Lending
The most significant reason to opt for direct lenders is their digital lending platform. They receive all loan applications online, eradicating the need for documentation and physical appearance at the lender’s office.
The online loan application system is the most convenient way of quickly fetching a loan. It generally requires straightforward steps.
First, you must visit the lender’s website and find an online application form. Fill out the form with mandatory details and then submit it. Wait for the lender’s response. Usually, the lender responds quickly and approves your loan request after a few minutes of evaluation. There is always a chance of same-day funding.
- Flexible Terms
There is another benefit with loans for people on benefits from direct lenders is their flexible lending terms and conditions. For instance, they will not ask you to submit too many documents. Instead, you only need to share your income proof and get accepted if everyone goes right.
There is another instance where direct lenders in the UK follow flexible norms. You are not bound to get only a small amount to borrow. Instead, you can obtain a reasonable loan amount depending on your loan affordability. Generally, one can get up to £5000 or even £10000 based on those benefits.
However, lenders will analyse the strength of those benefits and then finalise the loan amount.
- Acceptance criteria beyond credit score
This greatly relieves those without full-time income and living on benefits. These individuals have the common problem of poor credit scores. Due to a lack of stable income, they could not manage all payments, affecting their credit ratings. Consequently, they become ineligible to get loans at the crucial time.
On the other hand, direct lenders seem soft at this point, too. They can allow someone living on benefits with a bad credit profile to get the loan offer without restrictions.
There are two reasons for this. First is the soft credit check (that has no impact on anyone’s credit profile. Second is affordable lending (that is manageable from the applicant’s benefits or part-time income).
- Doorstep facility
Convenience is the feature that direct lending always carries. How about submitting your loan application by sitting at your home, processing the loan, and getting the amount at your home, too? Isn’t it interesting? Yes, indeed.
Many responsible direct lenders offer doorstep loans for people on benefits. In such a facility, they send one of their representatives to the doorstep of the applicant to verify the details and process the loan. Once confirmed, the desired loan amount gets transferred to the applicant’s bank account on the same day.
- Competitive interest rates
If you have opted for a lender with a good loan approval record and seems flexible in its approach, you always get competitive interest rates on your loan. The primary reason is affordable lending. You will get the loan amount, which is manageable and repayable from your monthly income. If you show your loan affordability, your lender will assign a loan at a competitive interest rate.
- Approval despite no guarantor
As mentioned above, loans for people on benefits are small personal loans. Thus, you do not need a guarantor to get a small amount. Your benefits and the part-time income will do the job for you.
There is another situation where these no-guarantor loans on benefits are useful. During a financial emergency, you do not have enough time to look for someone to guarantee the loan repayment alongside you. By opting for these loans, you can apply, get the approval and repay the loan on time. It also improves your credit scores.
- Unsecured loans
The reliable direct lender will not ask you to submit the loan collateral if no guarantor is needed. It means you can keep your assets safe as there is no need to pledge it as the loan security. Again, the reason is small funding for which lenders do not feel any risk.
Since the loan approval criterion relies on benefits and side income, collateral is unnecessary. However, the interest rates may be higher, but you will get approval at least to save your finances.
Loans for people on benefits are undoubtedly useful in more than one way. In addition, they will become more effective if you obtain them from a reliable direct lending place. The reasons mentioned in this blog are adequate to determine the importance of direct lending in fetching these kinds of personal loans. Of course, some risks will be there, particularly the higher interest rates. Still, these loans hold significance considering the accessibility of affordable and flexible lending.
Ailsa Adam is the Editor-in-Chief and former content head at Hugeloanlender. She has been a valuable member of the content strategy team since 2017 due to her abundant experience in the finance sector. Passionate about helping individuals navigate the world of loans and personal finance, she has dedicated herself to acquiring extensive knowledge on various financial products. Before her role at Hugeloanlender,
Ailsa worked as a seasoned journalist and writer, specialising in creating informative blogs and articles on diverse loan types. She is known for her meticulous research and commitment to delivering accurate and engaging content. She holds a degree in MBA Finance and has a keen interest in creative writing and art.