Don’t let bad credit stop you from getting a loan

There are many reasons why you may have a poor credit rating.

It could be that you’ve previously defaulted on a loan, missed credit card payments or have mortgage arrears or a CCJ against your name. But it doesn’t necessarily mean you can’t get a good deal on a loan. In fact, we specialise in helping people just like you.

What are the advantages and disadvantages of poor credit loans?

The biggest advantage of a poor credit loan is that it allows you to borrow money, despite the fact you have a bad credit history. For some people, this type of loan can be a big help if they need to cover an essential purchase, or consolidate existing debts.

Also, if you’re accepted for a loan, paying it back on time can actually help you rebuild your credit history. It shows lenders that you can borrow money responsibly and this should be reflected in your credit report.

The biggest negative is that a poor credit loan is likely to have a higher interest rate compared to a loan for someone with a good credit history. This means that it’s likely to cost you more to pay back than if you had a good credit rating.

Loans for debt consolidation

You could use a debt consolidation loan to pay off your existing debts at a reduced rate, over a longer period. This should make managing your finances simpler each month. You’ll just have to make one payment each month, rather than lots of smaller ones.

However, as you’ll be repaying what you owe over a longer period, you may end up paying more overall.

You can use either a personal loan or a homeowner loan to consolidate your debts. With a personal loan, you can borrow £2,000 to £5,000 over a 2 to 4 year period. If you own a property, you can apply for a homeowner loan. These range from £10,000 to £250,000 and can be repaid over 3 to 30 years.