Sometimes your monthly income just won't stretch far enough to cover an urgent expense or give you the extra cash you need. If this is the case then getting a long term loan might be the answer.
When comparing long term loans you're likely to find that there are two main types - secured and unsecured.
Which one you go for will depend on what exactly you need the cash for - so how do they differ?
Secured and unsecured loans: what's the difference?
An unsecured long term personal loan is one where you aren't asked to provide collateral in order to get the loan - though of course you do need to legally agree to pay it back.
In contrast, secured loans do require you to provide some sort of solid guarantee and collateral - typically your home - to ensure you repay the loan.
Why choose a secured loan?
The benefit of picking a secured loan is that you can generally borrow more cash and for longer. Providers are also more open about who they're willing to lend to, mainly because they already have your collateral as backup.
Why choose an unsecured loan?
You may want to opt for an unsecured loan if you don't want to run the risks associated with secured loans (you can lose your home if you default on your payments). Moreover unsecured loans can generally only be taken out for less time - meaning you pay them off quicker and pay less overall.
Compare long term loans online
When you make a long term loans comparison you'll notice minimum and maximum loan amounts can vary from company to company.
The maximum amount you can borrow with an unsecured loan may be less than the minimum amount you can get with a secured loan - so the amount of money you're after could determine which loan type you choose.
In terms of the longest available loans, these are generally secured - which you can repay for up to 25 years.
It's worth remembering that the amount of interest you'd pay for a loan over that amount of time could be considerably more than you would over a shorter period.
Some long term loans UK lenders will also penalise you if you want to pay off the loan more quickly - while others won't hit you with charges for faster payments.
So if you think you are likely to want to pay it off sooner to avoid paying more interest, compare long term loans direct lenders who allow early repayment.
Know how you much you want to borrow
If you take out long term loans with monthly repayments you want to avoid paying more than you have to - which might happen if you borrow more than you need in the first place. Try to work out exactly how much you need to borrow and stick to it so that you can avoid having to pay the loan back for longer.
You also need to consider that lenders may well have conditions in place that determine who they give cash to - if you don't match them you won't be able to get a long term loan.
These can include age limits, earning a certain amount or being a homeowner, so don't waste your time applying to ones where you don't fit the bill, as it may hurt your credit rating.
Repaying long term loans
You might think that spreading out payments for as long as possible will make it easier to repay the loan, but it could actually cost you a lot more than a shorter loan.
This is because the more months you have to pay it off for, the more times you'll get charged interest.
If you pay it off faster there'll be fewer instalments - meaning the company can charge you less interest.
Try to strike a balance between keeping your loan affordable and the total amount of time down to keep your overall costs as low as possible.
Remember that the representative annual percentage rate is exactly that - representative. When it comes to getting your loan it could be quite different to the advertised APR, so don't always take it at face value.
Our guide Personal loans - where to start has more information about what you should consider when it comes to APR and loan repayments.