While it can be difficult for homeowners to get the loans they want on the terms they prefer, those of us who don’t own property face our own problems. A large number of people still rent out their residences and this has a definite effect on their loan applications. The good news is that unsecured tenant loans are available, ensuring there are financing options for that niche as well.

The problem is that the tenants do not own the property, so they are perceived to have no guarantee or collateral. But as with all loans, the key issue is affordability. Securing affordable financing for tenants is not that difficult if you contact the right lender and the application is solid and in the right order.

But there are conditions to getting approved for an unsecured loan that all renters need to be aware of.

What are tenant loans?

The key issue for most renters and non-homeowners is a lack of assets. It means collateral is often hard to find, making it difficult to get loan approval. This is the void that unsecured tenant loans are designed to fill, providing those without access to property with much-needed funds.

The problem for lenders is that because people with no property or home of their own, no equity, and unlikely to have significant collateral, they are high-risk borrowers. As a result, excessively high interest rates are often charged, making the loan even less affordable for the applicant. But with so many people living in rented housing, the demand for affordable renter financing is high.

Loan limits can be as high as $5,000, although another unsecured loan option is a guarantor loan, which, with the benefit of a qualified co-signer, can be as high as $15,000. Meanwhile, the purpose can be anything, including buying a car, financing a vacation, or even consolidating existing debt.

Qualify for a tenant loan

The basic criteria required to qualify for an unsecured tenant loan are the same as for any other loan. Applicants must be 18 years of age or older, be a US citizen or legal long-term resident, and must have a source of income. The only other stipulation is that they are currently renting a property.

Another criteria needed to qualify is no recent history of loan default (within the past 24 months) or bankruptcy, although proof of income may also be required. Obtaining affordable financing for tenants will generally also mean providing concrete proof of income, showing that there is enough excess to meet the payments.

For large sums, from $10,000 to $25,000, it is also possible to obtain a guarantor, but this depends on the flexibility of the lender. Some are strict and have a firm limit of around $10,000. However, others are willing to extend the unsecured loan limit if the guarantor has an excellent credit history.

Online application

Typically, the best loan options are found online, with a variety of online lenders offering loan packages with the lowest interest rates and most flexible payment terms. It’s no different when it comes to unsecured loans for renters and other non-homeowners. The application process itself is simple, with basic information required in an online form, and it is normal for an advisor to answer queries while the form is being filled out.

Of course, there is a security issue with providing financial information online, so be sure to check out any potential lenders on the Better Business Bureau or Verify1st sites. But even if the lender is sure, the issue of fees and charges must be considered. Affordable financing for renters is available, but online quotes should be free. Therefore, read the fine details of the contract and the invoice to make sure that everything related to the unsecured loan is in order.