Personal Loans

Personal loans are basically loans that are not secured, but are repayable at a fixed interest rate over a fixed period of time, with the interest rate generally set based on an assessment of your credit history, risk profile and income. 

Personal loans can be advanced by many different types of financial institutions, from large high street banks through to small private organisations that cater to people with lower income thresholds.  

Some lenders charge very high rates of interest, include up front fees and charges, and if there is a default under the loan agreement, charge excessively high penalties, interest and charges.  Care needs to be taken when borrowing, particularly from lenders that offer low interest rates in the beginning, and who then charge higher rates as the loan advances.  

It can be quite common that before you pay off one loan, you may then be offered another larger loan, consolidating the original loan, but then extending the terms which means that you would be paying off more interest and charges than under the original terms of the loan.

On default, the lender has rights to seek recovery, and ultimately may pursue you into bankruptcy, and/or chase any guarantors that may have helped secure the loan for you at the beginning.