Private money lenders have consistently received bad reputations. Here, our MoneyShop private lender experts discuss the common issues associated with money lenders, and how to avoid a ‘bad loan’.
Myth 1. You need a perfect credit score to be accepted
Many people use private lenders because they cannot get their loan applications approved by banks and credit unions.
Why? Private lenders offer unconventional financing options that banks don’t include in their lending policies. So, private lenders are the only legitimate providers in NZ of flexible financing options for loan applicants with poor credit scores or inconsistent income.
Community-oriented lenders will sit down and listen to applicants with poor credit scores or unique financial circumstances. If you choose the right lender, you can actually improve your finances and credit score in the long term.
Myth 2. Private lenders are dishonest
Private lenders are dependent on having a good reputation and often rely on word of mouth referrals. Unlike high-paid bank executives, the owners of private lending companies are often personally invested in their business. So, their personal livelihoods depend on the success of their company, which in turn depends on the success of their loan applicants!
‘Loan sharks’ are easy to avoid. Make sure you stick to lenders who have good reviews and a team of transparent, friendly experts who help you through the loan process.
Myth 3. Private lenders are risky
Private lenders are actually less likely to agree to risky loans because they are invested in their business and have more to lose than banks. So, well-established private lenders can be more attractive to borrowers. Their longevity shows that they create sustainable loans that their applicants can successfully repay!
Need a private lender you can trust?
So, if you want to apply for a loan, we make the process as easy and stress-free as possible! We have competitive rates, streamlined online service, and helpful loan information. So, we have a long-standing reputation as one of New Zealand’s most trustworthy loan providers. Contact our friendly MoneyShop team if you want to talk about small or large fast loan options.
