How can amateurs find the right loan partner and avoid the bear traps?

How can amateurs use research to find the right loan partner for their specific needs So you think you need a loan but how do you avoid the bear traps? How can first time borrowers get a fair short term loan without paying through the nose? How can you protect yourself from rip off loan merchants? How can amateur borrowers protect themselves from rip off loan deals? Where does a desperate person go to borrow money without being ripped off? Is careful research the amateurs answer to getting the best loan deal? What the heck is a fair loan in the UK anyway?

 So you really need a loan but need advice on how to avoid the bear traps and rip off merchants. But where do you go? How do you start looking in the right places?

Which places are the right places?

You have heard and read about horror stories where borrowers ended up paying massive interest rates – over 1,000% APR – and then got caught in a trap of struggling to repay the capital sum because the interest rate meant the amount they owed kept going up.

You’re not a professional borrower or investor so how the heck can you guarantee that you will get a fair loan at a fair price?

Of course the trouble is that you might well be in a tight financial spot right now and the temptation is to just go ahead and borrow money from any lender that is prepared to lend to you.


Ask yourself the question; ‘how can amateurs protect themselves from rip off loan deals’?

The best answer is research. – Do your homework and examine the offerings from different lenders. – Yes even if you have bad credit. Remember, you are the customer and are going to be paying for a service so you deserve to be treated as a valuable commodity.

Most of us are amateurs when it comes to finance and it is nothing to be ashamed about; after all, most of us are amateurs when it comes to plumbing, electrics, fixing cars, computers etc.. 

Careful research is the amateur’s answer to getting the best loan deal.

Get on the internet and start reading. Some lenders specialize in certain types of loan; for example, short term loans over a few weeks or months (sometimes called payday loans). – These can be expensive in terms of interest but do have a role to play in the market as long as the borrower (you) is confident of repaying the loan plus interest at the end of the agreed term.

Other lenders need security in the form of specific guarantees; - such as securing the money against your assets like your home. – No use if you have no security to pledge.

Some will want guarantees that are not specific. – Still no use if you have a poor credit rating.

However, some lenders will take the risk without security or guarantees and if you are in this situation, you should focus on them.

It can however be a daunting process so where do you start?

A good first step is to look at some of the independent comparison sites that focus specifically on loan providers. Independent sites provide useful tools such as Smart Search Loans to help you find your way through the confusing maze of types of loan and lender.

There are obviously some basic filter questions that you should answer:

What is the loan for?

How much do you need?

For how long will you need it?

Will you be able to repay it in full by the repayment due date?

What monthly amount can you afford to repay?

Many lenders will let you apply online immediately. – Beware though… if you apply for a loan they will run a ‘hard’ credit check on you which will be recorded in your credit report and can affect your credit score.

So think twice before sending off multiple loan applications to different lenders. – Much better to do your research and pick one or two that seem to fit your specific needs… and talk to them if you want to.

The good news is that once you have borrowed money and successfully repaid it within the loan term, this will also be recorded in your credit report and will improve your credit score. 

You might think you are desperate but remember YOU are the customer. Do your homework, stay calm and focused and you will improve your chances of connecting with the right lender for your specific needs.

Take your time, don’t panic.

Calm research will help you avoid the bear traps.


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About the author

Roger Gewolb

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I am a serial entrepreneur who has spent much of his life in the financial sector and in doing so I have become very knowledgeable about the sector. This experience has enabled me to become the founder of the Campaign for Fair Finance™ and my current venture,

In my career I have started several lending companies and indeed I was instrumental in founding the non-prime motor finance sector, allowing people to afford to purchase a car who might otherwise been unable to do so.

My experience within the finance, and more particularly lending space, has afforded me the opportunity to advise the Bank of England, The Law Commission and the Treasury on various aspects of asset finance policy. Indeed I am currently assisting the regulators and some leading parliamentary figures to reform the UK credit and lending industries to create a fairer and more transparent environment.

At the same time, I also advise several charities and social enterprises on their financial and media strategies and help a number of exciting businesses across a spectrum of sectors and industries.

My experience within this industry sector has allowed me to become a media pundit and commentator on many consumer and particularly consumer finance issues and to become an ethical advisor to the emerging crypto currency and blockchain markets.


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