Guaranteed Personal Loans for Federal Employees

Being a federal employee has its benefits. However, as of now, the federal government does not provide guaranteed personal loans especially for federal employees. All the same, along with the government benefits that they receive, they benefit from numerous non-governmental organizations who wish to help them. Even though they do not receive guaranteed personal loans, these agencies help them to secure easy and low-interest personal loans.

Personal Loans

Personal loans are loans that are usually...taken against no collateral. As a result, the interest rates on this type of loan tend to be higher than on secured loans. People usually take this kind of loan to pay off credit card debts or tuition fees. It is also an effective way to consolidate debt, which allows the individual to regain control over his financial situation. Usually, banks and lenders offer this kind of loan to people who have a good credit score.

However, federal employees can avail of personal loans through another outlet as well. In this case, the peer group helps them through their financial difficulty. Thus, they might be able to secure a personal loan irrespective of their credit score.

Peer-to-Peer Lending

There are various groups that facilitate peer-to-peer lending among federal employees. Federal employees can put up any amount that they are willing to lend to fellow employees. The person who wants a loan explains his reasons, and shares the required information with the group. The lender reviews this information and fixes an interest rate for the amount he is willing to lend.

As with all loans, individuals with a good credit score get lower interest rates, whereas those with a bad credit score usually receive higher interest rates. The riskier the loan is perceived to be, the higher the interest rate.

Through this process, federal employees are likely to receive lower interest rates than other citizens. However, there is also a huge leap of faith involved. Certain employees, despite good credit scores, might not make timely payments, or any payments at all. All the same, the groups tend to have a collection process in place to minimize the lender’s risks.

Thus, through these peer-to-peer lending groups, federal employees can help each other secure personal loans at low interest rates.

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