I have bad credit, can I still get a loan?

August 16th, 2022
I have bad credit, can I still get a loan?

If you have bad credit, you’re probably wondering if you can get a loan. After all, many regular high street loans say that you need to have good credit as a basic criteria for acceptance. And no one wants to be turned down, and further damage their credit rating in the process! The good news is that you can get a loan with bad credit if you know where to look. And you can also rebuild your credit over time if you use the right strategies. In this article, we’ll take a closer look at loans for bad credit, what they are, who they are for and what typical loan features you can expect to see. We’ll also delve into what your credit rating is, and ways to improve it so you can improve your chances of getting loans in the future.

What is bad credit exactly?

Bad credit occurs when you have fallen behind on your loan or credit arrangements in the past. For example, you might have fallen behind on your mobile phone bill payment or missed your rent a couple of times. When you pay late or miss a payment, it records a note on your credit file. This is one of the factors that lenders use to assess whether or not you are creditworthy.

Who might have bad credit?

Anyone can have bad credit and most people will miss or be late on a payment or two in their lives. It’s easy to do, especially if you don’t have automated payments such as direct debits or standing orders set up. If you’ve struggled financially at any point with your incomings and outgoings then you are likely to have bad credit to some degree. If you have any CCJs against you or have been bankrupt, you will also have a bad credit score. The good news is that you can improve your score over time.

How can I find out if I have bad credit?

The easiest way is to check your credit report with Experian or another credit referencing agency. It’s free to check your credit report and it updates on a regular basis so you can see how it’s improving over time. It’s also a good idea to check it regularly to make sure that no fraudulent credit applications have been made against your name. It’s also important to really ask yourself if you need to borrow before you try to take out more credit. [1]

Can I take out a regular loan with a bad credit score?

Most lenders will not offer regular loans to people with bad credit. This is because this type of loan is a higher risk to the lender. However, there are various specialist lenders who do offer bad credit loans. These allow you to borrow the money that you need and to rebuild your credit score. The important thing is to read and understand the features and the terms of the loans before you take one out. This will give you the best possible chance of being accepted and repaying it successfully.

What are my options for borrowing with a bad credit score?

When you’re looking for regular loans bad credit will often mean you’re rejected. This means finding a product designed to meet your needs.

The best approach is to use a specialist loan comparison site such as Free Price Compare that includes bad credit loans. Often these loans are harder to find on the high street or through regular price comparison and loan comparison sites. Our website includes details of a wide range of trusted and reputable bad credit loans so you can see what’s available to you and at what terms.

Where can I find a loan for bad credit?

The good news is that when you do need a loan bad credit needn’t stop you. Explore Free Price Compare where you can search for the latest and best loans available to you. Simply enter your details and you’ll see a list of available loans for your circumstances. You can get these details emailed to you, or simply apply there and then for an instant decision. We provide all of the information that you need to make a decision about your loan and we only list trusted providers who other customers have used and recommended. This is important as there are plenty of unscrupulous lenders out there who are no better than loan sharks. Don’t risk it – use Free Price Compare to find reputable, regulated and genuine lenders with fair terms and quality products.

What are loans for bad credit no guarantor?

Some lenders want a guarantor if you take out a loan with them. This means that if you don’t stick to the terms of your loan repayment, your guarantor will become liable for your debt and be legally obliged to pay it. If they don’t repay your loan for you, they can be taken to court and their own credit record will be damaged. For this reason, many people don’t want guarantor loans. It can also be hard to find a guarantor for a loan, especially if you do have bad credit and you may feel uncomfortable about approaching friends or family and asking them to take on this responsibility.

However, if you know where to look, you can find a loan for bad credit no guarantor is required. These loans for bad credit no guarantor are usually offered by specialist providers with a niche product offering. The terms of these loans are important to read carefully as the interest rates tend to be higher than for standard loans because the interest repayment reflects the risk involved.

When you’re looking for loans for bad credit no guarantor may be needed if you can show that you are already taking positive steps towards managing your finances. For example, you might be meeting your other loan obligations each month, paying all credit arrangements, paying your rent and so forth. This helps to show the lender that you are financially responsible and ready to take on bad credit loans no guarantor needed.

What about secured loans?

Other loans may be secured, which means that you put up some kind of asset as security if you can’t meet your repayments. This security could be your house if you own it outright, but some lenders will accept other forms of security. It’s important to know that if you can’t meet your repayments or you fall behind on them, the lender can legally take your asset and sell it to recoup their loan and fees. It’s important to understand the features of these loans and to think carefully about whether they are right for you before you apply for one.

What are the features of bad credit loans?

Most people in this situation will look for a bad credit loan no guarantor required. And the good news is that various companies do offer these bad credit loans. Typical features of these loans are:

  • A relatively low borrowing amount, at least for your first loan. This is to allow you to show you can handle your loan and meet the repayments on time
  • A quick and easy application process which can usually be done online
  • A higher interest rate than you might find on the high street because this is a higher-risk lending product
  • The ability to repay early without any penalties
  • The option to make weekly or fortnightly repayments rather than monthly repayments
  • Quick payment of your loan, often within 24 hours. This is because bad credit loans tend to be for emergencies, so lenders work quickly to release the relatively small funds
  • A short repayment timeframe that reflects the shorter sum that you borrow and the emergency nature of the loan

The good news is that as you repay your bad credit loans on time and in full, you will build up your credit rating, making it possible for you to borrow more, more easily and to take on regular loans with lower interest repayments. Remember that if you feel you cannot repay a loan, it is important that you do not take one out. If you take out a loan and cannot repay it, you will damage your credit score and find yourself with extra fees and the risk of CCJs against your name.

How do I apply for loans with bad credit?

Simply visit Free Price Compare to search for the latest bad credit loans and see which are best matched to your needs. You will find full information about:

  • The lender
  • The amount you can borrow
  • The interest rate and any fees and
  • The terms and conditions of the loan, including acceptance criteria.

You can then apply directly online and get a quick decision on your loan. The loan sum will usually be paid directly into your bank account and your repayments will also come from this bank account or from the card details that you provide during your application. You’ll find that the applications are quick and fast and the loan sums are often within your bank account within 24 hours.

It’s also important to use a reputable loan provider, as some have a bad reputation and aren’t a good choice for customers. We only list reputable lenders on our website for your peace of mind. [2]

Can I apply for a bad credit loan if I am on benefits?

Some lenders will accept benefits as income when you apply for a bad credit loan. People on benefits often struggle with poor credit scores because of their limited income. The lender will usually consider benefits income as well as any part-time income from work and your ability to repay the loan which is determined by your outgoings. The lender may ask you to provide a breakdown of your financial obligations such as your rent, groceries, travel, nursery fees, maintenance, loan repayments, credit card repayments, mobile phone bill and so forth.

Bad credit loans for customers on benefits tend to have these features:

  • Specialist products with a high chance of being approved
  • Suitable for financial emergencies and small loans
  • Unsecured loans that don’t require any collateral or security
  • Flexible repayment plans so that you can repay as soon as you have income available, without any financial penalty
  • Loan sums are given according to your ability to repay
  • A higher interest rate balanced by a higher acceptance rate
  • Acceptance of benefits such as disability allowance, unemployment allowance, severe disability allowance and family allowance

How easy is it to get a bad credit loan approved?

With digital borrowing, it is easier to get your loan approved. With a bad credit score, you will have to go to specialist providers but the online process tends to be quick and easy. If you have a CCJ – County Court Judgement – against your name it will be harder to get approved than, say, if you made a late repayment a few months ago. Many people work on improving their credit scores before they apply for a loan.

How can I improve my credit score?

There are various steps you can take to improve your credit score. Here are some of the most important:

  • Avoid over-using credit cards and aim to keep your use below 20% of your available credit
  • Check your credit report regularly to ensure there are no errors or fraudulent activity on your card
  • Meet all of your loan and credit card repayments on time
  • Make sure you are registered on the electoral roll
  • Limit your applications in a short period of time as these will flag up money concerns to lenders
  • Ensure that you are only carrying out soft searches when reviewing different products to see whether you are likely to be accepted. At Free Price Compare we only use your basic information to carry out soft searches for suitability. This lets you see which loan products are likely to be suitable for you without registering on your credit report as an application. [3]

In conclusion

It is possible to rebuild your credit score for mainstream loans and it is also possible to access finance when you need it, even with a bad credit score, with bad credit loans. Check your report, get on top of your repayments and financial commitments and check for the latest bad credit loan options at Free Price Compare. Our service is fast, simple and free and you can access our lenders’ bad credit loans quickly and without complex or time-consuming processes.

When you need to find and compare the best loans and other financial services, head to a website you can trust. Use Free Price Compare and find the products that you need, fast and hassle-free.

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