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Borrow £500 for 4 Months, Four Monthly Repayments of £215.81 Total repayment £863.24 Interest Rate PA (fixed) 270.10% Representative APR 997%
Poor Credit Loans UK For Bad Credits
When talking about loans, you probably hear how banks and traditional lending facilities are turning their backs on bad credit borrowers. But why is that so? How does a bad credit rating happen? And do you have any chance to get a financial assistance?
Whether you’re just curious about a poor credit remark or you’re already suffering from it, the best way to get rid of it is to learn what it’s about.
First and foremost, a credit score is used by the lender as the basis of your approval. It determines if you’re a good candidate for the loan or if you’re creditworthy. A low credit score flags you as a credit risk and as a result, creating a new line of credit is almost impossible. Although some lenders may accept your application, you are likely to face more fees and charges because the only qualified loan you can have is the one that carries a high-interest rate.
A credit score ranges from 300 to 850 and the higher you get, the better your credit rating is. However, every lender has their own credit score but in general, it may look like this:
700 to 850 – Very good/excellent credit score
680 to 699 – Good credit score
620 – 679 – Average credit score
580 to 619 – Low credit score
500 to 579 – Poor credit score
300 to 499 – Bad credit score
Even if you have a low credit score, some payday lenders still look at it as a bad credit remark, therefore your chance of getting approved is slim. So to avoid such fate, it’s best to have enough knowledge about the causes of a poor rating. Below are some of the factors that contribute to a poor credit remark:
- Defaulting on payments
Even if you think that it’s just a credit card, failing to repay it leads to a bad credit. In addition, your unpaid account will be “charged off” after a month or so. A charged off implies that the credit has given up on collecting the repayment; however, you still owe them money.
- Late payments
Missed or late payments decrease your credit score. It also incurs additional charges which, eventually, become hard to settle. So to avoid this, be sure to repay the loan or your credit card on time. If you can’t, talk to your lender and ask if they can modify your terms or reduce some fees.
A charge-off happens when the lenders see that you cannot repay the balances anymore. This produces a very harmful effect on your credit score and should be avoided at all cost.
- Collection accounts
One of the risks that you should consider before getting a loan is facing intimidating debt collectors. Once you stop repaying the loan, the creditor can take another step before a charge off. They can hire or sell your debt to third-party collectors who will try to get the repayment from you. Collection agencies can be frustrating because of the method they use, including calling another family member or your workplace or even threatening you with a lawsuit.
Defaulting on a loan means you have abandoned the loan completely. Your credit score is negatively affected the same way as a charge off.
- Filing bankruptcy
Of all the causes, a bankruptcy is the most harmful to your credit remark. It’s a legal status of a person or a company that cannot settle the debts of creditors anymore.
This happens when you cannot repay your loan anymore, leading to losing your home. You are considered as a high risk because of all the missed and late payments recorded on your report.
Judgments decrease your credit score badly because it only shows that the court system has to file something against your just to repay your debt.
These are just some of the reasons why you may get a bad credit but no matter how desperate you think you are, there are still options available in the market. Lenders have noticed the increase in demand for bad credit loans, so they made limited alternatives to accommodate your needs. A personal bad credit loans for bad credit, for instance, is one of the debts that you can consider. The loan is fast unsecured loan and you can get an amount £1,000 – £10,000 with a repayment term of 12-24 months. No guarantor or collateral is required and it can be settled on an installment basis.
The amount you can have is relatively smaller than those who have a good or excellent credit remark. It also carries an extremely high-interest rate; however, this is usual for bad credit loans as this is the lender’s only way to compensate the risk. With a high-interest rate, those who are not capable to repay the total loan amount are discouraged.
But despite its drawbacks, a personal loan is beneficial especially when you don’t want to bother another family member or a friend. With its online platform, you can borrow money discreetly. However, you should only use it as a last resort; otherwise, you may suffer from a vicious cycle of debt when you cannot repay on time and you keep on extending the loan.
Nevertheless, the loan is helpful and you can use this for the following expenses
- Rent, mortgage
- Credit cards
- Home/car repair
- Buying appliances, gadgets
- Medical purposes
Looking For Bad Credit Loans Direct Lender
Having a good lender, regardless of the type of the loan, is important. So before you borrow a loan, be sure to consider these different qualities:
- Provides sufficient limit
Before you visit or send your application to the lender, be sure that he can provide you the amount you need. If his funds are sufficient, then it’s best to look for another loan provider. So, be sure to go for someone who is willing to meet or go over the amount you require.
Most banks and traditional lending facilities are following specific guidelines and although they are just complying with the requirements, it’s still best to choose someone who can provide flexible financing terms. Find a lender who can help you reach your capability, whether it’s about extending the loan or reducing the interest rate.
For most people, the terms used in banks and loans are confusing; therefore, you need to find someone who has the patience to answer all your concerns. The company should be responsive and proactive enough in walking you through every terms and condition. No matter how many questions you ask, they should be willing to answer your concerns until you know if you made the right choice.
Are you willing to provide your personal and financial information to a lender who’s been involved in a scam before? If not, then considering the lender’s reputation is imperative. As much as possible, you want someone who’s trustworthy, reliable, and receives positive reviews from their clients. There are no perfect lenders and most are likely to receive negative feedback; however, you have to know if the positive reviews are prevalent than the bad ones.
To know whether the lender is a good loan provider or not, check out their track record or experience. It’s always safe to go for a lender who’s been in the industry for a good number of years, is an expert when it comes to the in and out of the loans and has sufficient knowledge to address your concerns.
Bad Credit Loans: Guarantor
When you have a bad credit and you’re planning to borrow a higher amount, you have two options – to provide a guarantor or collateral. Let’s first discuss what a guarantor loan is.
A guarantor loan is a type of loan that requires another person to co-sign the agreement. His role is to provide assistance or support the loan in case you defaulted on it. Nevertheless, a guarantor doesn’t secure a low-interest rate. Therefore, before you get a loan, you need to get yourself and your credit report ready by doing these:
- Improve Your Credit Report
An affordable loan starts from checking your credit report. Your credit bureau will assist you in getting a free copy of it. Be sure to check each and every account entered and report any discrepancies. One of the reasons why a person receives a bad credit, despite being a responsible borrower, is because of an inaccurate data entered. If you find any of these, inform your credit bureau immediately.
- Reduce Your Debts
Having multiple debts and repaying it is a hard task; but if you have a bad credit remark, this will surely make a huge difference. After getting your credit report, check all your accounts, especially the unpaid ones. Find out the total amount, interest rates, and the charges it carries and creates a repayment plan. You can either get a debt consolidation loan or talk to your lender.
A debt consolidation loan allows you to merge all your accounts into one single debt. This way, you will reduce the time spent on repaying different lenders and the interest rate you’re paying.
The other option you have is to talk to your current lender and ask if they can give a flexible repayment term so you can easily settle your debts.
- Ask Your Bank About Payment Reminders
Repaying on time is a must when borrowing a loan to avoid accumulating fees or decreasing your credit score. But due to several factors – like limited time, unemployment, short fund or unintentionally forgetting about the debt – most borrowers cannot commit to the agreed repayment period. To ensure that you will not miss any payment, ask the bank or the lender to send you a notification. Most financial establishments send payment reminders via email or text. You can also give the lender an access to your bank account so they can automatically withdraw the repayment.
Bad Credit Loans UK: Finding Bad Credit Loans Instant
There are many ways on how you can find the right bad credit loans instant and the most familiar option is by going online. Using your research skills, compare different lenders including their rates, policies, and repayment term. This way, you’ll know who is offering the best deal. You may also turn to loan brokers. These licensed professionals are trained and educated to match you with the appropriate lender. Otherwise, you may use comparison websites. These pages contained necessary details to help you compare loans quickly and easily.
Applying For Bad Credit Loans No Guarantor
Another option you have is giving collateral. When you look for bad credit loans no guarantor, you can pledge an asset and use it as a security against the loan. It can be a house, car, jewelry, stock, gadget, or any item of value. If you have a bad credit and you want a lower interest rate or a bigger amount, this loan is a good option. However, the risk is that you can lose your property if you stop repaying the loan. Legally, the lender can repossess your asset and put it on the market. The proceeds will be used to settle the loan and the incurred fees.
Bad Credit Loans UK: Bad Credit Loans Instant
Whether it’s a secured or unsecured debt or a loan backed up by a guarantor, getting a loan is easy. Even if you have a bad credit, you can get it in a very convenient way and that is by applying online. First, visit the lender’s website and fill out the application form provided. Normally, it will ask for your personal and financial details. Once the lender has confirmed or verified the data you’ve provided, they will release a decision immediately. After getting the approval, the lender will send the money to your bank account. While some enders transfer the fund within three days, some loan providers can do it in as fast as one hour.
5 most recent personal loan reviews
I love CSC loans I have been with them nearly three years, need a top up as my son is getting married. They where brilliant as usual, no problems, done so quick - they were my life savers when needed most, thank you.
Review posted by Mary Hartnoll, Canterbury
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Value For Money
As guarantor for my daughters, loan the service we got was quick and efficient, did checks, asked questions and all was sorted very quickly, would definitely recommend Together loans to all.
Review posted by Susan Mills, Darlington
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Brilliant service. The application process was a doddle, the Shawbrook representative who called me was polite, understanding and cheerful. The whole thing (from starting the application process to receiving the money) took around 3 or 4 hours. Very quick and efficient and no long or silly forms to fill out. Just what was necessary. Am very pleased I chose Shawbrook.
Review posted by John Marcus, Surrey
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Value For Money
Representative 277.5% APR
Representative Example: Borrow £700 and pay £111.27 per month for 12 months at an interest rate of 140% per annum (fixed).
The total charge for credit is £635.24 The total amount repayable is £1335.24. Representative 277.5% APR (variable). Your APR rate will be based on your circumstances
Non-payment could have a negative impact on your credit rating and have increased charges and interest rates.