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Loans for People on Benefits [guarantor payment]

Loans for people on benefits [guarantor payment] are generally not provided by loan companies because of regulations protecting people on low incomes. If you are "guaranteed" a loan when on benefits you should always check the authority that regulates the company (normally the Financial Service Authority) and the company registration.

Even loans for people on benefits with guarantor payment protection are probably unregulated companies. You still don't have a large income to support yourself, and a guarantor will only end up repaying the loan for you. Loans for people on benefits with guarantor payment acceptance wouldn't make sense and would still leave you in debt.

 

Why Lenders Should Not Offer Loans to People on Benefits

By law, lenders are required to check that borrowers can repay the loan without pushing them into debt, which many lenders ignore. They cannot legally provide a loan to someone on benefits because their income is low and they are not in employment and cannot feasibly afford to repay any kind of loan, even with low APR. If you check on most lender sites you'll find that you need to be receiving a fixed income above a certain amount and can only lend around £80 minimum from most lenders - if your income from benefits is £180 per month and you pay around £30 of interest (calculating from the APR of a payday lender) then you'll pay back £110 next month. Could you really afford to meet daily living expenses on the month you pay back the loan?

 

How to Check Regulated Companies

As mentioned previously you probably won't find a regulated loan company offering loans to people on benefits [guarantor payment]. You can check the company information at the bottom of most lender pages, including registration and who regulates the company. Always check the regulated authority and the registration number for the company to ensure the regulated authority is real and that the company is actually registered. Companies registered with any kind of Data Protection Act or Data Protection Company are not financially regulated.

 

Directgov Loans

Loans for people on benefits [guarantor payment] can be taken out from Directgov. Their loans are really limited to crisis loans or budgeting loans but you won't pay any interest or could receive a grant which requires no repayments. You can find information about Directgov loans for people on benefits at: http://www.direct.gov.uk/en/MoneyTaxAndBenefits/BenefitsTaxCreditsAndOtherSupport/index.htm

 

(Note to editor: I couldn't fit "guarantor payment" in realistically throughout the article so I placed [guarantor payment] in areas where the full keyword could be fitted. You can delete those bits at your discretion (: )

By law, lenders are required to check that borrowers can repay the loan without pushing them into debt, which many lenders ignore. They cannot legally provide a loan to someone on benefits because their income is low and they are not in employment and cannot feasibly afford to repay any kind of loan with fixed interest rates. Even small loans should not be[guar

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