Common Types of Guaranteed Loans
When you hear the term guaranteed loan, most likely you think of a loan that is guaranteed to be issued. Or maybe you think of a loan that is guaranteed to be paid in full. Depending on your perspective, a guaranteed loan can mean different things. In truth, there are several types of guaranteed loans, some more common than others.
Personal loans are a common type of guaranteed loan. They are considered guaranteed because they are almost always granted. They are really easy to get, even for people with poor credit. Guaranteed personal loans don't require a credit check or collateral most of the time. Since there is very little personal information required to apply, there is not a lot of paperwork to fill out. The turnaround time for processing of the loan usually only takes a day or two.
Government guaranteed loans are another kind of loan. Within the umbrella of government guaranteed loans, there are a few different kinds of loans. The title of the loan comes from the fact that the government is backing up the loan. Lenders don't have to shoulder the responsibility of the loan since the government will continue to pay on any defaulted loans.
One very common government guaranteed loan is a student loan. There are several different student loans including Stafford and Perkins loans that the government backs. Since the government is backing the loan, lenders are usually not as concerned with the borrower's credit history. Students can usually receive pretty good interest rates with their student loan as well thanks to the government guarantee.
The guaranteed business loan is another type of loan that falls under the umbrella of government guaranteed loans. It can be really difficult for someone who has a new business idea to get financial backing to start the business. Lenders see them as very high risk. With government business loans, the risk is assumed by the government. If the borrower defaults on the loan, the government will continue to pay the lender so they are not out any money. Thanks to these kinds of loans, lenders are more willing to take a risk on a person with a new business idea.
Generally, business loans also offer repayment schedules of about ten years. This is beneficial to a start-up company since it can take at least two years to start making a profit in most cases. Government guaranteed business loans help make small businesses a reality for many people. So whether you need a short-term loan quickly, funding to complete your higher education or assistance to start a business, there may be a guaranteed loan option for you.
Personal loans are a common type of guaranteed loan. They are considered guaranteed because they are almost always granted. They are really easy to get, even for people with poor credit. Guaranteed personal loans don't require a credit check or collateral most of the time. Since there is very little personal information required to apply, there is not a lot of paperwork to fill out. The turnaround time for processing of the loan usually only takes a day or two.
Government guaranteed loans are another kind of loan. Within the umbrella of government guaranteed loans, there are a few different kinds of loans. The title of the loan comes from the fact that the government is backing up the loan. Lenders don't have to shoulder the responsibility of the loan since the government will continue to pay on any defaulted loans.
One very common government guaranteed loan is a student loan. There are several different student loans including Stafford and Perkins loans that the government backs. Since the government is backing the loan, lenders are usually not as concerned with the borrower's credit history. Students can usually receive pretty good interest rates with their student loan as well thanks to the government guarantee.
The guaranteed business loan is another type of loan that falls under the umbrella of government guaranteed loans. It can be really difficult for someone who has a new business idea to get financial backing to start the business. Lenders see them as very high risk. With government business loans, the risk is assumed by the government. If the borrower defaults on the loan, the government will continue to pay the lender so they are not out any money. Thanks to these kinds of loans, lenders are more willing to take a risk on a person with a new business idea.
Generally, business loans also offer repayment schedules of about ten years. This is beneficial to a start-up company since it can take at least two years to start making a profit in most cases. Government guaranteed business loans help make small businesses a reality for many people. So whether you need a short-term loan quickly, funding to complete your higher education or assistance to start a business, there may be a guaranteed loan option for you.
About the Author:
Trinity helps people to learn about student loans, how to find a guaranteed loan, and about personal loans for people with bad credit.
posted by Credit Counseling at
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