A loan is a sum of money given to a borrower by a lender with stated terms and conditions. The lender is usually an individual, a corporation, a financial institution or government agencies. The stated terms and conditions may include some financial charges, interests, repayment dates, amount to be repaid, collateral and or any other conditions. In most cases, not everyone can afford a collateral to secure loans which makes obtaining it difficult. The good news is that there are Lenders in Nigeria that offer quick loans without collateral and you will know about them all as you read on.
The cost of securing quick loans depends heavily on the loan type. Some loans are gotten in minutes, while some are in hours, days, weeks and some loan applications can last up to a month. All these types of loans, their requirements and application processes are discussed in this post. Before we continue, let us clear the air first.
What are Grants?
Loans should not be confused with Grants. In fact, they are opposite sides of the same coin. When a grant is issued, there’s no plan for repayment. The giver doesn’t ask for money back let alone interest. Grants are mostly issued by NGO’s and government agencies. Grants are mostly given for empowerment purposes, however, the issuer may require some proofs that the given money would be channeled to the right purpose for which it was given. Documents like business address and personal identification may be needed.
What are Interest-Free Loans
This type of loan is usually given by government agencies, NGO’s or trusted close friends. No financial institution gives interest-free loans because it’s their source of income. In this type of loan, the lender gives money to the borrower without asking for interest. The borrower pays exactly the borrowed amount.
Types of Loans issued by Financial Institutions
In Nigeria, US, UK see here now, Germany, Norway etc, there are different types of loans issued by banks and other financial institutions. These loans differ in amount, interest and duration of repayment. The type of loan requested by an individual is heavily dependent on the needs.
This is a type of loans offered by most banks to their customers whose credit score meets the requirements. It is usually an unsecured loan (loans without collateral). It is mostly used for paying of bills, purchasing of electronics and other household equipment, buying of clothes and other personal wears. In most cases, the lender must see the borrowers statement of account to see if the borrower really worth the amount he’s applying for. The lender will also demand proof of identity and residential address. During application, BVN is required for all Nigerians. In cases where the lender is the bank, you must have and account with them, therefore submitting the above listed documents is needless. You can access up to 15 million naira ($30,000) if your are a salary earner with good credit score. The borrower will first of all apply for the loan, the borrower will get notified within minutes/days of application depending on the financial institution as to whether the application is successful or not. Personal loans usually have a flexible repayment schedule up to 5 years depending on the lender. This type of loan offers a great help to people but it should be taken with caution.
Pay Day/Pay Roll Loans
Another name for this type is salary loan, it’s required that the borrower be employed before applying for it. The borrowers employment details must be verified before disbursement. Pay day loans are also of the unsecured loans type. The repayment period is usually short and they’re mostly characterized by high interest rate. The borrowers salary, credit profile and age will determine the amount to be approved. Workplace ID and or salary statements are among the required details. If you’re a Nigerian, your BVN would be required.