At QuidMarket, we don’t offer long term loans, but we believe that it is crucial for us to offer a review of all the loan types that are available. This will help you to make an informed decision on which type of loan is best for you and your budget. On this page, we will cover long term personal loans, what you should look for if you do need a long term loan in the UK, and explain how our short term loans differ from them. Hopefully, we can help you to make an educated choice about whether long term loans are the best option for you.
What Are Long Term Personal Loans?
Long term personal loans are available from banks and building societies, as well as direct, online lenders. They are loan agreements that are usually repaid over a timespan longer than a year and are typically targeted at those looking to make large purchases, such as home improvements. Some offer terms of up to 30 years, although most long term loans in the UK will be between 1 and 15 years. With long term loans, you spread the cost out over time, typically at lower interest rates than other loans. However, it is important to remember that while the interest, and the individual monthly repayments, may be smaller than with short term loans, you will be paying the interest for a longer duration. This could end up making long term loans a more expensive option overall.
Long term loans are typically larger sums of money to help cover expensive purchases or life events. This could include home improvements, paying for a wedding or covering education fees. They are also sometime advertised as debt consolidation loans, due to their manageable monthly payments, but we recommend that you seek advice from debt services before choosing to take out long term loans in the UK. While it may be tempting to borrow a large amount of money with lower monthly repayments, the fixed interest could mean you pay back more than you had originally thought.
As well as the building interest, some long term personal loans may also charge for early repayments and could take extra fees if you miss your monthly repayments. If you find that you have the budget to cover the monthly repayments, but haven’t factored in the interest rates, long term loans may not be the best option for you.
Reasons To Take Out A Long Term Loans
There are many reasons why you may be looking to secure long term loans, but most of the time, it is to cover a large cost or investment that you may not otherwise be able to afford. This can include purchasing a new car or paying for a wedding, as well as covering a broken down boiler or emergency repairs on your car. You may not have enough available credit on a credit card to cover the costs or you may not have enough to pay off the balance quickly. You might also be considering long terms loans to pay off existing payday loans, but should seek professional advice before doing so – there are plenty of free resources online who can help, such as the Money Advice Service.
If you are looking for loan to cover non-emergency payments, such as re-decorating your home or a holiday, you should always consider other payment methods before borrowing. Consider if the non-emergency payment is necessary and whether it can wait until it fits in with your budget, and if it isn’t essential at this time, it may not be worth taking out long term loans in the UK.
Can You Get Long Term Loans With Poor Credit?
As long term loans are aimed at those who are looking to make a large purchases, you may be able to secure one with poor credit. Unlike some loans, long term personal loans are not specifically designed for those with financial difficulties, so they aren’t solely based on your credit score. However, if you have poor credit and a history of missing repayments on credit cards or direct debits, for example, then you may find it more difficult to secure a loan or find that the long term loans offered to you have higher interest rates.
Different lenders will have different criteria, so it is crucial to research fully before you attempt to secure long term loans with poor credit. If you have poor credit, lenders may look closely at your credit rating and potentially offer you a loan with a higher APR, which could be detrimental if you struggle with repayments. Generally speaking, it is important to remember to make sure you can afford monthly repayments before you apply for long term loans with poor credit. If you have any doubt, it’s better to seek advice and consider other means of financial support.
Alternatives To Long Term Personal Loans
Long term loans may sound like an easy option, but they aren’t necessarily the best solution for everyone’s needs. There are a few different options that may be suitable for your needs, depending on your current finances.
- Borrow from family and friends – if you have the offer from friends and family to borrow money with no interest and with no worries of ruining personal relationships, this can be a great choice that doesn’t involve a middleman. You can reach an agreement on repayment that suits both parties and avoid paying high interest that could leave you worse off.
- Use your savings – if you have a considerable amount in savings accounts, it could be worth considering whether the interest you are gaining on them is worth the interest that you are paying on your debts. Check if you are liable for early repayment fees, then consider using your savings to pay off your debts.
- Transfer credit card debts to a 0% credit card – if you have reasonable credit card debts, you may find it beneficial to transfer their balance to a single 0% interest balance transfer credit card. However, this method will only work if you reduce your credit card spending, ensuring that you can repay the balance in full before the 0% interest period ends.
QuidMarket do not offer long term loans, as our aim is to help hard-working people overcome their short-term financial needs. We do offer loan terms of 3-6 months and completely tailor the repayment plan to suit your budget. Our short term loans are designed to help people cover any short term cash flow issues and emergency situations. They should not be used for long term financial difficulties and if this is a position that you find yourself in, please visit the Money Advice Service for free and impartial help.