Do lenders offer guaranteed payday loans for bad credit? This question may come to the forefront if you have a bad credit rating but want to borrow a small sum of money until your next payday. So, are payday loans guaranteed?
We don’t want to get your hopes up, so right away we will tell you that there is no such thing as a guaranteed loan, payday or otherwise. There is good news, however, and this is that a payday loan is usually easier to find approval for, even with a poor credit rating.
Why Lenders Cannot Guarantee Loans
No lender is going to guarantee you a loan without them first obtaining information from you. Lenders will not guarantee a loan because:
- They need to look at your credit file to find how big a risk you are
- You have to be at least 18 or over to apply for a loan
- You need to have a regular income coming in
- You need to be in a position to repay the loan
- You need to have a UK address
- You have to hold a bank account in your name
- Have a debit card attached to the bank account and
- Be able to set up a direct debit so the lender can take the repayment/repayments
The above are just eight reasons why no lender in the UK is going to be able to guarantee you a loan before getting some information from you and determining your circumstances and ensuring the loan is affordable.
If a lender were to guarantee and give someone a loan when that person had no means of repaying the loan or stood very little chance of repaying it, it would be unethical of that lender.
Ethical lenders will not make a statement saying they will guarantee you a loan. Here at Bonsai Finance, we will not make false promises that the panel of lenders we work with will guarantee you a loan.
Don’t Believe Everything You Read About Guaranteed Payday Loans for Bad Credit
If you were to make a search online for guaranteed payday loans, you will be led to believe that there is such thing as a guaranteed loan.
You will see headlines from your search stating, “Everyone approved”, “100% approval” and “no credit check payday loans”. These are just a few of the ways that some lenders or brokers will try to entice you into visiting their site to apply for the loan.
Actually, when you visit the site, you find out that you are not guaranteed a loan. Instead, you have to fill in information then apply for the loan. You might find approval, depending on your circumstances, or you might be turned down. So much for the loan being guaranteed!
What We Can Guarantee
While we cannot guarantee you a loan, we can guarantee that the following is true:
- We are not lenders, instead, we work alongside a large panel of UK lenders to match borrowers with those lenders;
- The panel of lenders that we work alongside will take all circumstances into consideration;
- Lenders consider loan affordability instead of just looking into your past credit history;
- While lenders will not offer the best APRs to people with poor credit ratings the lenders we work with will offer some of the best rates for your circumstances;
- We can search with a panel of lenders from one single loan application, boosting your chances of finding a lender who will approve a loan;
- As you are not making several applications, they are not going to be noted on your credit file and go against you in the future;
- After giving us some details you are given an instant decision;
- The lenders we work with offer numerous loan solutions, including payday loans.
Payday Loans Are Easier to Find Approval For
Payday loans are generally easier to find approval for than other loans due to them only offering a small sum of money that is repaid back quickly.
However, as we have said before no loans are guaranteed. Approval is going to depend on your credit score, affordability to repay the loan and other criteria.
How Much Can I Borrow With Payday Loans?
How much you might be able to borrow with payday loans is going to vary between lenders and your ability to repay the loan.
As a general rule of thumb, lenders may allow you to borrow between £100 and £500.
Payday loans are often called same day loans, quick loans or emergency loans. The reason being it is quick to apply for such loans. They come with an instant decision and money is often paid out within hours of applying if approved. People who apply for payday loans usually do so as they have been met with an unexpected financial outlay but they do not have the money to cover that outlay until their next payday.
How Long Can I Borrow For With A Payday Loan?
Payday loans are not long-term loans in that you borrow the money and then spread the repayments over a long period.
When payday loans first arrived in the UK they were loans taken out for a period of one month and repaid in full when the borrowers next payday came around. Assuming of course that the borrower is paid on a monthly basis.
Today lenders will usually allow payday loans to be spread out for over three paydays or months.
The good side is that this can make the loan more affordable. On the downside, the loan is going to cost you more in interest as interest is generally calculated on a daily basis.
Payday Loans and Bad Press
When the payday loan first arrived in the UK, there was no monitoring and the loans began to earn themselves a bad name.
This was mainly down to unethical lenders offering people loans without checking affordability. When people could not repay the loan on time lenders charged high rates of interest and fees with the loans being continually rolled over.
In some cases, people had to repay well over twice the amount they had originally borrowed. Since that time, many unethical payday lenders have been closed down and the FCA keeps a watch over payday lenders.
Payday Lending Remains Popular
In January 2019, This Is Money reported that during 2018 consumers had taken out £1.3 billion in loans, including payday loans. This shows that payday borrowing is still popular within the UK. The FCA reported that over 5 million short-term loans were made during that period.
Now the FCA has ensured that limits are in place for the number of times lenders can roll over loans, along with putting caps on the cost of borrowing.
Payday Loans Can Offer Quick Cash
Payday loans can work as intended providing you make sure that you can afford to repay the loan as agreed.
They can be a viable solution to meeting any unexpected outlay that has not been budgeted for and the process is usually fast and efficient when applying.
The entire loan application can be made online and in many cases, the funds from the loan are paid into the bank account on the same day. This type of loan is usually one of the easiest types to apply for and find approval for, even with poor credit ratings.
We can help to match you with lenders and while they do not offer guaranteed payday loans for bad credit, they will consider all circumstances and your ability to be able to repay the loan.
How Lenders Check For Affordability
The lenders we work alongside take affordability very seriously. To make sure that you can afford the loan they will consider how much money you have coming in each month and what you payout. Providing you have enough disposable income, there is a good chance a loan will be approved, particularly as you are only borrowing a small sum of money.
Short-term Payday Loans
While not actually termed a payday loan there is a loan by the name of a short-term loan. As the name suggests this loan is repaid back in the short term but that term is longer than the one to three months offered with a payday loan.
Short-term loans are generally repaid over a period of up to 12 months. However, this might vary depending on the provider and your credit rating. With short-term loans, it might be possible to borrow up to £1,000.
As you can spread the cost of the repayments out over 12 months it can make the loan more affordable, but it can also make the total cost of borrowing more expensive. Therefore, you might want to look at your finances and decide how much you can afford to repay each month and choose the lowest term of borrowing to save money on interest.
How to Apply For Your Loan Online
Applying for a loan is easy. Simply make sure that you meet the eligibility requirements, including being 18, living in the UK, having a UK bank account and debit card and having a regular income.
Apply with our help and give us your details and we can search with a wide range of lenders on our panel. Lenders offer some of the lowest rates and most affordable loans along with considering your ability to be able to repay the loan. They will check your credit rating but as the amount you are borrowing is small, they will not look too deeply into your credit past.
You get an instant decision so you do not have to hang around waiting to find out if you have been approved for a loan.
If we match you up with a lender, you can take your time and check out the details of the loan and if you are happy with the terms and conditions, you can go ahead and sign up for it.
Payday loans and short-term loans are two of the easiest types of loans to find approval for if you have a poor credit rating.
The loans are suitable for anyone who needs to borrow money quickly to get past an unforeseen financial outlay and they know without a doubt that they can repay the loan as agreed with the lender. However, they are not to be considered as loans to be relied upon from month to month or loans taken out to pay off other loans.
Above all, there is no such thing as guaranteed payday loans for bad credit, although this type of loan is generally among the easiest loans to be approved for with a poor credit rating. We can help to bridge the gap between borrowers with poor credit ratings and lenders as we work with a large panel of UK lenders. You get an instant decision and if approved money may be paid directly into your bank account on the same day.