BAD CREDIT LOANS

What Are Bad Credit Loans?

Bad credit loans are a form of an unsecured small loan which you can borrow from a lender in the UK. Most lenders have now started giving out loans to people who have a poor credit score. They are also known as small loans, little loans and no guarantor loans. As mentioned this loan is unsecured, that means you don’t have to provide any asset for the loan like you have to in secured loans. This takes away the fear of losing your asset when you due to any unexpected event cannot keep up with the repayments.

You can borrow from a bad credit loan if you have –

• Poor or fair credit score
• No credit score at all

Banks nowadays won’t provide you with a loan if you have no credit history at all. They cannot risk themselves by giving out a loan to you even if your credit history even though you don’t have a good or bad credit score. So, people like them who want to borrow money can opt for bad credit loans instead.

When Can You Borrow Bad Credit Loans?

A Bad Credit Loan can be used in a sudden financial crisis that arises out of nowhere. It can be due to any pending bills that are past its due date, or for any house or car repairs. The amount needed for such occasions is small, so you can borrow a bad credit loan instead of any other form of long-term loans.

How Much Can I Borrow from a Bad Credit Loan?

As bad credit loans are used to take care of your minor financial requirements the amount that you can borrow is not huge. You can borrow from £50 to £3,000. However, be sure to borrow a loan that you can afford to repay. As missing your payment can result in you having to pay a penalty fee. Also, it’s in your best interest to borrow what you require instead of going for the highest cap.

Eligibility Criteria

In order to be eligible for bad credit loans, you should be –

• A UK Resident
• Above 18 years of age
• A phone owner which should have an active number
• Having a UK active bank account

Pros and Cons

Pros

• You can borrow a small amount of money
• Bad and no credit history does not drop your chances of getting a bad credit loan
• The online application process is simple
• No paperwork needed
• If approved the loan is credited within 10 minutes

Cons

• High APR compared to secured loans. However, there are lenders who charge 2.97% APR which is relatively low for a bad credit loan
• You have to repay back within 1 to 12 months. This can affect your monthly budget, so borrow if you can afford to keep up with your repayments and daily needs