Taking out any financial or credit product carries a degree of risk. What are those associated with an unsecured personal loan?
The biggest element of risk comes in the form of missed repayments. Missing a payment can lead to a borrower seeing a negative impact on their credit score, with each missed payment recorded with credit reporting agencies. Accumulation of missed payments can then lead to an account going into default, and potentially the borrower can be taken to court and even be made bankrupt through failure to meet repayment obligations.
Avoiding the risks of an unsecured loan is simple to do. It is up to the borrower to ensure they are able to meet their repayment obligations when applying for and accepting a loan.
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