By Tom Dawson

Unfortunately as a result of the credit crunch tenants are not treated in the same way as homeowners when it comes to arranging finance of any kind. There are a number of reasons why this is the case but the main ones are the fact that tenants tend to move around more often and do not tend to stay in the same place for very long. Also because they do not own their own home they are unable to offer any security or collateral to the lender in order to strengthen their case. Add to that the fact that most banks these days that offer unsecured loans require that you are a customer, and in most cases also want you to be a homeowner.

All tenant loans that are offered are in fact unsecured loans (require no collateral, or security), and although in very rare cases they can be arranged for amounts up to 25,000 they generally will only be available for amounts up to 15,000. They can be used for any purpose including debt consolidation, school fees, home improvements and many more. The most popular term that this type of loan is taken out for is 5 years but in some cases the larger loans can be taken out for periods up to 10 years. This type of loan can be very useful for people who do not own their own home but still want to arrange finance.

If you are a tenant and have a bad credit history there are still a number of options open to should you need to arrange a loan. Although the loan size that is offered will be lower, and the interest rates charged will be higher. As with any type of loan making regular repayments to it and not missing any will help to improve your credit score. This will make it easier for you to arrange a cheaper loan at a better interest rate once it has been fully repaid. Probably the most popular bad credit tenant loan that is available currently is the guarantor loan.

A guarantor loan is a specialist bad credit loan that can be taken out without a credit check, and so long as you are not in an Individual Voluntary Arrangement (IVA) or registered as bankrupt, it does not matter how bad your credit history is. You can borrow up to 5,000 with a guarantor or co-signed loan, and repay them for terms of up to 5 years depending on the amount that you borrow. They can be paid out relatively quickly so long as you provide the lender with all the documentation they require. However in order to qualify you will need a guarantor to indemnify the loan on your behalf. This means that if you fail to repay the loan the lender will require the guarantor to make the repayments on your behalf. For this reason you should be certain that no matter what you can easily afford to repay the loan or your guarantor will be lumbered with your debt.

About the Author: Tom Dawson is a UK

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