What is a quick loan?
- This is a short-term loan of the non-bank lending sector, which can be obtained via the Internet online, using a computer or telephone. Because of its technical solution, it is also called the Internet or online loan.
- Its positive qualities – quickly give out (10 – 15 minutes), just to receive (without pledge, without guarantees, without documents), it is convenient to make an application (via the Internet).
- Its average repayment period is 30 days, which can be extended for another 30 days.
- Its volume is possible from 1 to 10,000 EUR, depending on the conditions of the lender.
- The first loan in most cases, free or interest-free loan.
- Most lenders, on issuing such a loan, offer the option to receive it by sending messages, i.e. make an application via SMS.
- The borrower must be between the ages of 18 and 85, must be a resident or citizen of Latvia, he must have a stable income, a positive credit history.
- Fast credit in most cases is issued to those persons who have a bad credit history or solvency, or both of these features are present.
Loans with bad credit history
What is a credit history?
- It includes all actions related to taking and returning a loan.
- It displays not only settled, but also current credit obligations.
- It shows not only each payment and its deadlines, but also whether you repay the loan or not, and even if you did it on time or not.
- The dates of any debtor’s credit history are available in the credit register of the Latvian Bank, in the CreditReform debt collection database, in the databases of enterprises of the non-bank credit sector, that is, the lenders databases, as well as in the internal database of any enterprise.
- In fact, this is a very significant factor, which is assessed by a potential client before the loan is delivered.
What is a bad credit history?
- Credit history is spoiled by two circumstances – regular delay in repayment of the loan, or non-payment of a loan at all.
- Lenders avoid building credit relations with people who have a bad credit history, because they are concerned that they will also treat their credit obligations irresponsibly and frivolously as the previous ones, thus crushing the company’s financial condition and negatively affecting its work. Persons with bad credit history are considered unreliable, therefore, creditors are skeptical and cautious about working with them.
- A corrupt credit history prohibits, or at least reduces, the possibility of obtaining a second loan in the future.
- The worse the credit history, the less chance of getting a loan from anyone, especially the banking sector lending.
- Although, over time, the debtor settles his previously unsolved credit obligations, the credit history does not improve, because, instead of a payment not paid, the fact of his delay is preserved. In fact, the credit history, just like any file from the past cannot be changed or corrected, it only remains to ensure that the future credit history is positive, if only the debtors will be given loans in the future.
- Experience shows that if a credit history is corrupted many years ago, the chances of getting a loan are more, because lenders check a potential client’s credit history only for the previous year, and lenders want to believe that a person can change over time, become more conscious and responsible. Therefore, it cannot be stated unequivocally that in the case of a damaged credit history, the loan is categorically denied.
- The smallest chances to get a loan from a person in that case, when referring to the creditor, she has not completed previous loan commitments that confirm that the person cannot repay the loan.
- Experience shows that non-bank lenders treat lenient credit history more condescendingly than bank lenders, because they give out loans in relatively smaller amounts and in repayment terms – in short, which significantly reduces the financial risks of the company.
Quick loans with bad credit history
- Evaluating credit history is a mandatory, integral process that is used in the banking and non-banking lending sectors in order to avoid unprofitable and loyal customers who, if they do not return the loan, can cause material damage to the company. It should be noted that financial losses occur not only on time not paying the payment, but also when it is delayed. But, as mentioned many times, creditors of the non-banking sector, credit history is not assessed as seriously as it is in the field of bank lending.
- In this area, especially fast loans, credit history is viewed in general, because non-bank lenders, issuing a loan, do not risk such large amounts and long repayment periods. In short, non-bank lenders can afford to take the risk and issue a loan to unreliable persons, i.e., those who have a bad credit history and poor solvency. Bearing in mind that fast loans are currently the most popular types of non-bank lending, quick loan lenders can risk even more.
- But, most of the debtors who have a bad credit history, it arose due to, exactly, fast loans and their availability. The availability of fast loans, as is well known, contributes not only to technological solutions for their acquisition, but also to the democratic conditions of creditors. But, as you know, demand creates supply, so as long as people borrow, lenders will offer all new types of how to borrow.
- As mentioned above, a quick loan is an alternative loan to persons who have a bad credit history or solvency, or both problems at once.
If you have a bad credit history, but you need financial resources, analyze the offers of non-bank lenders to solve your situation, as well as your personal ability to repay the loan in a long time, make a decision responsibly – you may not have the opportunity to use the lenders offer and get Finance in another, alternative way?
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