In Sweden, interest rates are historically low, and at the same time, the market has been flooded by different types of loans. Traditional mortgages and bank loans have long been the standard, but recent years have seen a dramatic increase in alternative solutions, such as the much-discussed payday loans (also known as sms-lån).

Loan without Security
Loans without security now take up a major slice of the market. Unlike traditional loans and mortgages, loans without security require no personal belongings, nor that you have a guarantor. When you apply, they are quickly processed, in what is sometimes only a matter of seconds. There are two different types of loans without security: personals loans (also known as consumer loans) and payday loans.

When applying, the loan company runs your data through a credit rating agency, quickly determining whether you are capable of repaying. In Sweden, Upplysningscentralen, UC, is the central agency tasked with this.

However, it is also possible to circumvent Upplysningscentralen by applying for a loan company that cooperates with a different credit rating agency. This is commonly referred to as a payday loan without UC (in Swedish sms lån utan UC). If you already have existing loans with Upplysningscentralen as the credit rating agency, this will increase your chances of being granted a loan.

Still, in order to be granted a loan, many different factors will be taken into consideration: Your income and age for once. Naturally, all loan-companies require you to be 18 years of age at least, and some even require a minimum age of 21, 23 or 25. If you have applied for a loan but were rejected by the company, further employment and increased income are the best means to being accepted the next time around.

Loan Requirements in Sweden

• You need to live in Sweden with a permanent address.
• You must be at least 18 years old, although some loan providers require you are 21 or older.
• You need an income; the exact amount differs among providers.

Be responsible with payday loans

You might have watched Lyxfällan on television, a reality-programme where people with extortionate debt try and turn their lives around. Many of these have taken several payday loans, which just shows how responsible you must be with all kinds of borrowing. Payday loans are practical and quick but if you decide to use them, you should always work out a budget. Some of the loans are interest free the first time, but that does not continue, and the interest rate can be very high.

A competitive loan market as in Sweden favours the consumer, but you still must do your research, in order to reach a sound economic decision.