While business lending in the UK recently fell for the first time in a while, consumers continue to borrow at a considerable rate. This is reflected by the rising level of consumer spending, which is at odds with the prevailing economic climate and the volatility caused by Brexit.
Some of this spending is financed by borrowing, of course, whether this is through credit arrangements or personal, unsecured loans. While the concept of securing loans is particularly frowned upon in the current climate, however, there are instances in which they can provide a convenient and sensible business solution.
Is It Worth Applying for a Loan? Here Are Some Instances where it May Be
With this in mind, let’s take a look at some of the circumstances in which applying for the right loan can be extremely beneficial. These include: –
1. Plugging a one-off Purchase or Expense
While payday lending has been heavily criticised and regulated in recent times, it has also offered financial relief to applicants who have used this market responsibly. More specifically, payday loans are designed to fund a one-off purchase or expense, as applicants borrow a manageable sum that can comfortably be repaid from their earnings the following month. If your car needs an urgent repair but you are approaching pay-day and lack the funds to afford this, for example, a payday loan can instantly bridge this unexpected cash-flow deficit.
It is only when these loans are used to fund an existing lifestyle or applicants fail to understand the impact of APR that this type of lending can be damaging.
2. Funding Home Repairs
We have all been there; you desperately want to refurbish your home but simply lack the disposable income to achieve this goal. This is where an unsecured personal loan comes into play, however, as this can provide cash and flexible repayment terms without putting your home at risk. With outlets such as Everyday Loans also offering this product to those with a poor credit history, this type of financing is easily accessible and can be used to fund the repair and restoration of your property.
It can also be used to fund other big-ticket purchases too, such as taking a holiday and purchasing a car.
3. Financing Large-scale purchases
Even with a standard personal loan, you may find it difficult to fund larger, big-ticket purchases. In these instances, you may prefer to pursue a financing option, which is a common form of lending that consumers often use to procure cars, kitchens and most notably houses. This type of lending is usually secured, but it offers a manageable and affordable way of paying for big-ticket items that can add value to your everyday life. Like a loan, you will repay your debt through monthly repayments, so it is simply a case of comparing the market and researching repayment terms to find the best solution for you.