Doorstep loans – What are they?
Doorstep loans or home collected short-term loans have been around for many years. When you apply for a doorstep loan you are usually visited by an agent in your home. The doorstep agent will give you the loan in cash, or occasionally vouchers, and will return weekly to collect your repayment. You will receive a payment book in most instances so you can keep track of what you owe.
Short term doorstep loans can be useful to customers who wish to discuss their loan requirements face to face. Some customers prefer this approach as it gives them the ability to discuss their needs in their own home at a time that is suitable for them.
Customers who do not have a bank account often struggle to obtain credit, where many UK doorstep lenders do not require you to have a bank account.
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What are the disadvantages of Doorstep loans?
Doorstep loans in the UK can be more expensive than other types of short term loans. Also, first-time customers can borrow a maximum of £1,000. Payments are usually collected weekly which can be quite restrictive for some customers looking for a short term loan
Many customers who use doorstep lenders go on to use them multiple times. The ability to have cash delivered to your home and to have the repayments collected is very convenient to some, though Cheaper credit alternatives may be available. As with all credit, think carefully and ensure that you can afford the weekly repayments.