The increase in previous or current credit problems for many people has led to a changing of the guard in the relation to available credit options. If you are not fortunate enough to have a spotless credit history, the chances are many of the options that existed previously will not exist to you any longer. Possession of CCJs, arrears, being self-employed or even having no credit history at all have led to financial institutions which were falling over themselves in the past to hand out loans all but shutting out borrowers due to stringent lending policies. Fortunately there are now a rising number of lenders who specialise in offering bad credit loans specifically for those borrowers who have found themselves being frozen out.
Specialist Bad Credit Lenders
These specialist lenders fully understand that just because someone may have run into financial difficulty in the past, does not mean that they are a lost cause who can never be trusted again. By providing bad credit loans to a wide variety of applicants, as long as the borrower can demonstrate an ability to meet their monthly repayments, financial options will exist. Perhaps of equal importance is the fact that because these lending institutions are prepared to take a ‘chance’ on borrowers with negatives marks on their credit record, the borrower will receive a golden opportunity to work towards repairing any damage on their credit record by paying off the loan on time and in full.
Which Bad Credit Loans are Available?
Getting credit can often feel like an impossible task and it is easy for people to feel as though all options have deserted them when they get turned down, there are though, a number of bad credit cash loans which are currently available, including:
Guarantor Loans – Work by utilising the presence of a guarantor who will agree to step in and make the repayments should the borrower fail to do so
Doorstep Loans – Work by agents visiting the home of the borrower to hand over the balance of the loan in person along with collecting the repayments on a weekly basis
Tenant Loans – Have been designed for anyone who does not own a property to offer as collateral for their loan – i.e. private tenants, living with parents etc
Debt Consolidation Loans – These are designed to allow borrowers to pull all existing debt under one roof to stop the build-up of several lines of debit interest
What Else Do You Need To Know?
The interest rates associated with bad credit unsecured loans are always higher than standard unsecured loans but it varies greatly from loan to loan and from lender to lender. Each lender will have its own criteria for determining whether to accept you as a customer and will use the information that you provide on your application form to make a decision. The main difference though is that with bad credit loans, the acceptance threshold for lenders is far more tolerant than with standard loans.
Amanda Gillam is Solution Loans's General Manager and has been since 2009. She is also a prolific writer on personal finance issues, and has been quoted numerous times in articles published on 3rd party websites and in press releases. Her...Read about Amanda Gillam