Home credit, also known as home collected credit, is a type of loan. The money you borrow is delivered directly to your door and repayments are collected in person by your local agent. Because all transactions take place at your home, these types of loan are often referred to as doorstep loans.
Benefits of home credit
Home credit can be a simple and straightforward way of lending. To begin with, you decide the amount of money you’d like to borrow and the number of weeks you’ll pay it back over. The lender should then inform you of the total amount you must pay back including interest, and how much this will work out per week.
Many people choose doorstep loans because lenders might offer the following benefits:
● Flexible - You can borrow small amounts and pay them back over a term that works for you. If you need to reschedule a repayment you should be able to discuss this with your agent.
● Personal service - Repayments will be collected from your home by your loan agent who should also be able to answer any questions you might have.
● Convenient - Payments are collected from your home and you should be able to arrange these for a time that suits you. No visits to the bank, writing cheques or transferring money online.
● Responsible lending - A reputable lender will only lend what you can afford to pay back and should complete credit and affordability assessments for each loan.
● Simple - Doorstep lenders generally offer fixed interest rates, so you know exactly how much you will pay back each week – this varies lender to lender.
Things to consider
Home credit loans can be a good solution if you find yourself with some unexpected costs and struggle to get credit elsewhere.
If you have suffered with bad credit in the past then a home credit loan may work for you as some doorstep lenders will consider people with less than perfect credit histories.
Home credit can be useful if you only want to borrow a small amount – maybe you’ve had an unexpected cost like a broken boiler or a big gas bill. With a home credit loan you can borrow a little and not go into unnecessary debt.