Borrowing festive loans have become a recent trend. Instead of saving money for spending during the festive season, nowadays people want to take less headache by borrowing money. In such a condition, many direct lenders also offer festive loans to borrowers for a minimum interest rate.
There is no doubt that Christmas is a huge festival for us. We all love to gift each other and shop for some special things for ourselves during this time. In a recent survey, it has been observed that, in the last 5 years, people have been more prone to borrow money during Christmas.
This is because it is the boss of all festivals and people need money to spend. Perhaps you are also thinking about borrowing online loans for Christmas. But before borrowing, make sure you have analyzed the following things.
Things to keep in mind while borrowing a Christmas loan
There is no exception of festival loans because it drives out the necessity of urgent funds. While people may suffer for funds due to mismanagement of finance and, as a result, unable to spend it during the festive season, a simple borrowing can drive out the problem. Lenders design festive loans so that they will drive out all the financial issues.
- Make sure you are eligible.
Unlike any other loan, this festive loan also has some criteria. Moneylenders will lend money to those who have,
- Good credit score
- Do not have a huge amount of outstanding loans.
- Different lenders set different criteria. It must come under a minimum income band. However, most lenders look for borrowers who have a minimum of 12000 pounds income in a month.
- A borrower must show a good repayment history.
- There is no case of CCJ against that borrower.
- The borrower must be able to repay the loan within a short period. This Christmas loan will not give the ease of repayment for a long time.
One and the only reason to make sure whether you are meeting all the eligibility criteria is to make sure that you need not pay any extra charge. No lenders want to reject the application for a Christmas loan due to the festival. As a result, if you are not meeting the eligibility criteria, then it becomes difficult to cope up with the rate of interest.
- Check the rate of interest.
Before applying for a Christmas loan, make sure that you have checked the rate of interest. It is such a thing that is applicable on every repayment. Therefore, if you have skipped the interest rate and borrowed money, it can run you into the loss.
As mentioned, there are so many lenders used to lend money during the festive season. This is because they want to make a profit by lending money at a high rate of interest. But it can become harmful for your financial condition.
- Borrow the only required amount
Perhaps your loved ones have gifted you expensive gifts. But it does not mean that you also need to gift them some of the expensive gifts. When you want to gift expensive gifts, then your borrowed money will not be adequate enough.
In that case, you need to borrow an extra amount to cope up with your own expenses. Do not over-borrow because, later on, you need to repay the entire amount. So, before borrowing money, make sure you are applying for only the adequate amount.
- Compare the processing fees.
Actually, it is a completely false promise. Every lender used to charge a processing fee for sanctioning loans. While processing such short-term loans, many lenders used to attract borrowers by telling them there were no processing fees.
Lenders used to advertise like this to grab the attention of borrowers. Later, they apply lots of hidden charges. So, to save yourself from such lenders, compare the processing fees with other lenders.
- Tenure of repayment
After borrowing a Christmas loan from direct lenders of the UK, you need to repay the entire borrowed amount. However, one can repay it through monthly instalments or by repaying the entire amount at a time. Generally, for repaying the amount through monthly instalments, one can get only 12-24 months.
As a result, a person needs to repay it within that stipulated period. So, make sure about the repayment period that suits you.
Who can borrow Christmas loans?
There is no boundary for borrowing a Christmas loan. Everyone can borrow it. Moreover, people who have fulfilled the eligibility criteria can easily borrow such a loan. Even after a person cannot fulfil the criteria and still needs a loan, he can appeal especially to direct lenders.
Apart from common people, many businessmen apply for Christmas loans. In order to open their business, these people would like to apply for the loan. Actually, during the festival lots of people start shopping so, at that time, new business ideas work the best. Therefore, borrowers find pleasure because they can distribute small and large loans to people. Christmas loan brings happiness to people as they can drive out the necessity of fund by borrowing money during the festival.