Bad Credit Loans

If you have a bad credit rating there are loans available whether you are a tenant or a homeowner. Choose from unsecured and secured, guarantor or non-guarantor.

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What is a bad credit loan?

Bad credit loans are for people who have a poor credit rating either because of previous money problems or because they have only a limited credit history. Credit problems could include:

  • Arrears, Defaults & CCJs
  • Part-time employed & Self-employed
  • Discharged from Bankruptcy, completed IVA or other debt management plan
  • No accounts or No proof of income
  • Limited or no borrowing history

In addition to the normal reasons for credit (e.g. debt consolidation, car purchase) people often use a bad credit loan to improve their credit score by demonstrating they can manage debt successfully.

How to get a loan with bad credit

Start by considering the amount you can afford to repay each month so it comfortably fits within your budget. This will help you define the amount you can borrow. Look at the different types of loans available to ensure you choose the one that meets your circumstances and needs.

It may also be worthwhile looking to see how you can quickly improve your credit rating as this will improve the deals you can get.

Consider what you need

1: Consider what you need

The amount you need to borrow, the amount you can afford to repay each month and what you can offer a lender in terms of security or otherwise.

Complete the Application

3: Complete Your Application

Visit the product page and follow the application process outlined.

Loan Paid Out

4: Get Your Money

Depending on which product you choose your loan could be paid out instantly or after a few days/weeks if a guarantor or security is required.

Types of bad credit loans

Millions of people in the UK have a credit problem of one form or another. You are not alone. We have a range of loan options that could help:

How much will a Bad Credit Loan cost?

Having a bad credit rating puts a lender on alert. They compensate for the extra risk they see by charging a higher interest rate. You’ll also notice that if you are prepared to offer an asset as security or provide a guarantor that you might be able to reduce that interest rate. Effectively you are opting to take on some/all of the lender’s risk.

Things to consider when borrowing

If you are thinking of applying for finance, even though you have an adverse rating, you should consider:

  • Interest rates: typically you’ll pay a higher interest rate if you have a poor credit score
  • Unsecured vs secured: to get a better interest rate you could provide security, but are you really prepared to lose your asset if you default on your debt repayments?
  • Guarantees: getting someone to support your application should help you get a better rate for an unsecured loan.
  • Your credit score: if you do borrow more and make repayments on time and in full then you can improve your credit rating. If you fail to then you will make it worse.
  • Borrowing term: as with any form of debt the longer you borrow for the higher the total interest on that debt will be. This is made even more noticeable by the higher interest rate you will be paying.
  • Loan amount: only borrow what you really need.

Trends in bad credit loan applications

Looking at the applications we get for this type of loan there are some obvious trends:

  • Debt consolidation is the most common purpose – to make monthly repayments on existing debt more manageable.
  • Perhaps because applicants have been rejected over an over again they quite reasonably want quick lending decisions. And a fast payout is also considered very beneficial.
  • People on lower incomes tend to have a poorer credit rating – with a higher proportion of income required for meeting life’s basic expenses and with greater job and income insecurity this is unfortunately the case.
  • It may not surprise you but younger people tend to have a worse credit score perhaps linked to lower incomes and their spending habits.

How to Improve Your Credit Rating

However, there are potentially many other factors. We’ve written a detailed guide to how to manage your credit file – there’s more you can do than you might initially think.


Our Money & Credit Guides

If you’re uncertain which type of credit might suit you or you have a money problem then one of our guides may help you. We summarise each type of loan and their pros and cons and address issues regarding debt and credit ratings.

Bad Credit FAQs

Answers to Your Bad Credit Questions

Bad credit, poor credit, adverse credit – these are all terms for the same thing. If you are finding it hard to get a loan or another form of credit (even a new mobile phone contract) then you’ve probably got information on your credit file that is scaring lenders away.

You’ll probably have lots of questions about how you came to get a bad credit rating, what you can do about it and where you can get credit from in the meantime. We deal with these issues and others in our FAQ below:

Why do I have bad credit?

Any company that extends credit to you or lends you money reports your repayment behaviour to at least one of the UK’s three main credit reference agencies – Equifax, CallCredit and Experian. They will retain this information for six years. Any other company you wish to borrow from can access this information to decide whether they wish to give you credit.

There is obviously a spectrum of information that is held about your credit behaviour – from a single missed payment on a loan 4 years ago, for example, all the way through to that bankruptcy that happened 2 years ago, etc. So, not all information has the same weight. Even a lack of any credit history (perhaps because you’ve just become an adult, or moved to the UK) can weigh against you. While you might term this “bad credit” it clearly isn’t the same thing.

If you have become unwittingly the victim of identity fraud there may be information on your credit file that is false and that could count against you. There is also the chance that there is incorrect information held about you that you will need to get removed.

How long does bad credit last?

Generally, the cutoff period is 6 years – e.g. credit agreements stay on 6 years after they were settled; CCJs stay on 6 years after the day of judgement. Searches by lenders to whom you have applied for credit remain on your file for 12 months. Other information (e.g. linked addresses, whether you’re on the electoral roll, etc) remain on your file indefinitely.

So, if today you were to classify yourself as having bad credit and had no outstanding credit agreements, it would take up to 6 years for your file to naturally “clean” itself. But there are actions you can take to speed things up.

How do I get rid of a bad credit history?

You can do this by:

  • checking your file to ensure the information on there is all correct
  • not applying for credit you know you’ll be rejected for – searches are stored for 12 months
  • taking advantage of credit products that are designed to help improve your credit rating
  • ensuring that if you do have live credit agreements that you make sure repayments are on time and in full – new good news will help to dilute bad news already held in your credit files.
I have bad credit. What are my loan options?

If you have a credit problem then lenders will need you to offer something to compensate for the additional risk. This could mean one or more of the following:

  • charging a higher APR%
  • requiring you to provide a guarantor
  • needing you to provide security

With these mechanisms in mind your options are likely to include:

Keep in mind that making too many applications will in itself also damage your credit rating.

Which bad credit loan is best?

This will depend on your personal circumstances. If you have a credit problem you should first ask yourself if borrowing more is sensible. If it proves to be unmanageable then you will simply make things worse.

However, if you believe that you can afford the repayments and make those payments on time then your choice will come down to asking yourself some questions:

  • What’s the minimum amount you really need? You don’t want to borrow more than you have to.
  • Can you provide a guarantor, if required?
  • Do you have an asset you could use as security (e.g. your car or house)?
Keep in mind that any asset you offer as security could be repossessed if you fail to keep up the loan repayments.
What are my options for a bad credit loan without a guarantor?

Guarantor loans have become a popular form of bad credit loan primarily because they are unsecured and typically offer a lower APR% than other bad credit personal loans. However, if this isn’t an option you can or want to consider then there are some other alternatives.

These alternatives will mean you need to pay a higher AP% or offer some form of security to the lender:

Keep in mind that any asset you offer as security could be repossessed if you fail to keep up the loan repayments.
Is there a no credit check loan available?

We’d love to say yes, but unfortunately, there is no such thing as a “no credit check loan”.

Can I get car finance if I have bad credit?

If you want finance specifically to purchase your next vehicle then we work with a specialist broker who can cater for bad credit ratings.


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For over a decade Solution Loans has helped people all over the UK find solutions to their personal finance problems.



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Our reputation is great. In fact we have scored 4.7 out of 5 based on 262 ratings & 41 user reviews for our bad credit loans service.


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Written/Reviewed by: Amanda Gillam

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