Requesting money by unregulated indicates may be an attractive option in some instances, but it involves risks that individuals will explain today.
What is a particular lender?
Individuals or institutions that will lend money without being the regulated financial entity these are known as private or private loan companies, that is, they are not banks or even loan funds.
A private lender in South america City can be, for example , an individual who has collected an gift of money and wants to do business simply by lending money in the brief and / or medium term.
While this is not unlawful (as long as particular requirements are met), you can find reasons why you should avoid likely to these types of lenders.
Why should you avoid private lenders
As we mentioned earlier, a personal lender is not considered as a bad deal.
However , it could be so in some cases; and because they are not completely regularized, it really is difficult to realize.
Robin offers you some reasons why you need to avoid private lenders:
The main reason is because they are very costly
The personal lender knows that those who reach him are people who really feel they have no alternative. Because of not having a steady job, working with a bad credit history or just for needing money urgently.
This is why private loan companies take advantage and charge quite high interest rates, sometimes they could actually be considered a crime (usury).
You can lose much more compared to what you receive
Private lenders know that their particular applicants may not pay your debt. That is why they are protected using a guarantee that can be a property, an automobile or a person with set and high income (guarantor).
Which means that in case you fall behind with the financial debt, you can lose even your house.
No backup or even regulation
In several countries there is no regulation or even law that properly manages private lenders.
That is, in many cases the clauses that you will find in the contracts with this particular type of lender are unjust.
However , since there is no regulation, after putting your signature on you will not be able to easily attractiveness or denounce usury within the contract.
For any this, Robin always suggests you to look for other funding options and not go to personal lenders even in exceptional circumstances.
Alternatives to casual loans
There are always options that offer more security which you can get with a little help.
Robin suggests that you think about some options before going to some private lender:
Ask for a loan from a family member or even friend
Even though this can be very uncomfortable for many people, this is a much safer and less expensive option than going to a specific lender.
Once you learn a family member or friend that has enough capital, you may not actually charge an interest rate. It all depends upon your relationship with that individual and the trust you create.
Go to a microcredit middle
In South america there are financial and cost savings banks that are regulated plus allocate loans to people along with low resources or with no credit history.
Microcredits usually have high interest rates to get small amounts, but they are a wise decision for those who have just entered the particular financial system.
Robin the boy wonder can be an important help if you want a quick loan, since Robin the boy wonder evaluates your needs and your user profile to compare the best lenders which could accept your application.