7 Finance Terms Everyone Should Know...

When applying for a loan or simply searching the market, it’s important that you are aware of some of the jargon you will come across, here are a number of terms you may see:

Credit
Credit is a term that describes the lending of money from a financial institution to an individual or company. If you apply for a loan from loans4tenants.com, you are effectively applying for credit.

Direct Debit
Direct Debit is a safe and quick way to pay back instalments of your loan from your bank account. Once you have purchased your loan you give the lender a mandate to take the agreed repayments from your account on the same date of every month until the is completely repaid.

Guarantor
A guarantor is a person who is willing to guarantee the repayment of a loan agreement. Popular choices as guarantors are friends, family members and work colleagues, the guarantor must be a homeowner who is receiving regular income and have good credit history.

Repayments
Once you have agreed to take out your loan you will be liable to repay it in manageable monthly repayments for as long as you’re Loan Period. A Direct Debit Mandate will be set up with your bank to make automatic safe monthly repayments from your bank account. Once the loan has been completely repaid, you will no longer need to make any repayments.

Secured Loan
A Secured Loan is any loan that has a provision for the return or collection of an asset when payments are not made. Secured loans are usually made for cars and houses. This means that if you take out a secured loan on your house, and you fail to make the repayments, the value of the loan will be collected from you, which means you may lose your house if you do not make your monthly repayments.

Tenant Loan
A Tenant Loan is another term for an Unsecured Loan. Tenant loans are aimed specifically at people who do not own any property. Tenant loans are a way for people who rent their accommodation from the council, private landlords or who live with parents to apply for a loan. Loans4Tenants specialise in Tenant Loans.

Unsecured Loan
When a loan is unsecured it means there is no provision for the return or collection of the loan when payments are not made. For this reason the APR’s tend to be a little higher than a Secured Loan, and the repayment period is shorter. Unsecured Loans are also referred to as Tenant Loans.