Can Personal Loans Be Transferred to Another Person?

If you think your personal loan can be transferred to another person, you need to reconsider it. Your personal loan can’t be transferred to another person. You get approval for your loan based on your credit score and income due to which it’s non-transferrable. 

Some types of personal loans, such as signature loans, require your signature and use your promise to pay as collateral. 

What Happens If You Do Not Repay a Personal Loan?

If you don’t pay your loan on time, it can affect your credit score badly. Your lender can transfer your loan to a collection agency, making your life very stressful. Moreover, your lender can report you as a defaulter to the three credit bureaus – Equifax, Experian, and TransUnion.

This default can be reflected on your credit for 7 years so it’s really important to make your payments on time. 

  
Your lender can include a set off clause in your contract to avoid long repayment periods. A set-off clause allows the lender to seize your funds from a specific bank account. 

What Happens When You Have a Co-Signer or Guarantor?

The only instance when your loan is transferred to another person i.e., another person is liable for repaying the remaining balance is when you take out the loan with a co-signer or guarantor. 

Co-signers are legally responsible for the personal loan as the person to whom the loan is issued. 

A borrower cannot transfer the responsibility of his personal loan. However, by getting defaulted on his personal loan, he makes his co-signer or guarantor liable for unpaid balances. 

If you ever apply for personal loans, make sure that you repay them on time. This will help you avoid getting hit by the three credit bureaus. Need to know more about personals loans and how to apply for them, you can contact banks in Stillwater.

Comments

Post a Comment

Popular posts from this blog

Credit And Debit Cards; what’s The Difference?

Image
Many people don’t see the difference between a credit card and a debit card. Because they believe both cards provide almost the same financial output for them; let them buy things. If you wish to manage your finances smartly, it is imperative to learn the difference between these two.  Credit Card  With the credit card, a financial institution like a bank allows the user to borrow money from them on a short-term basis. Stillwater bank and trust is one such institution. Later, the user has to return the money with interest (differs from one card to another and based on plans). The primary benefit of credit cards is that you can borrow more money than what you have in the account. When a user withdraws cash from the credit card, he is taking debt from that financial institution. Yes, users can withdraw money from credit cards, just like a debit card. However, the interest rate, the limit, and other features vary from one card to another. There are various types of credit cards,
Read more

Do You Qualify For A Small Business Credit Card?

Image
Getting approval for a small business credit card isn’t difficult and usually doesn’t need lots of paperwork. But the big question is, how to get approval for a small business credit card.  You can get approval for a small business credit card if:  You own a legal business – You can apply for a small business credit card if you already own a business. You have to submit your Employer Identification Number (EIN) and your Social Security number. Moreover, you need to maintain a good credit score as your personal credit report will be determined for the approval of a new business credit card. Your revenue – Don’t lie about your income when you’re applying for a small business credit card. Tell the truth and go through a financial review with a bank. If you’re a start-up and haven’t earned much, don’t worry to share your right income. You can also share the estimated income - if you’re sure that you can earn that. But if you haven’t started earning yet, your small busines
Read more