If you are considering applying or a loan, but you have bad credit you may be wondering what types of loans are out there. Payday loans are a popular small loan offering a way of getting out of a bind if a financial emergency crops up. But do lenders offer guaranteed payday loans for bad credit?
Ethical Payday Lenders Do Not Guarantee You a Loan
No lender will guarantee that they will provide you with a loan before they look at your credit file and other criteria. If a lender promised you a loan before doing so, they would be unethical. All UK lenders need to make sure that you can afford a loan and the only way they can do this is by looking at the amount of money you have coming in each month and what you have going out. Lenders have to look after their best interests along with yours. It would be unfair to offer you loans that you cannot reasonably afford to pay back.
On saying this, we work with a panel of lenders who consider all aspects. They take into account any regular income you have coming in along with any outgoings for other bills. They will also check your credit file but many lenders only make a soft credit check when you want to borrow a small sum of money.
There Is a Loan Called a Guarantor Loan Available
Just to clarify, there is a type of loan available called a guarantor loan. This is not a guaranteed loan; it is a loan with a guarantor by your side, usually a good friend or relative.
This means you ask someone to stand as your guarantor and if you cannot make the repayments on the loan, the guarantor takes over the repayments. While there is a better chance of being approved for a guarantor loan, there is no guarantee that a lender will give you a loan. You still have to undergo a credit check, as does the guarantor, and the lender will still want to ensure that the loan is going to be affordable.
Generally, when borrowing such a small sum with a payday loan lenders do not ask that someone stand as guarantor.
Guaranteed Payday Loans No Credit Check / for Bad Credit Are a Myth
Guaranteed payday loans are something of a myth as no lender in the UK can promise they would give you a loan as it all depends on numerous factors whether you are eligible.
For instance, even to be in a position to apply for a payday loan you have to meet certain criteria. This criterion includes:
- Being over 18 years of age;
- Having a regular income;
- Living in the United Kingdom;
- You have a bank account with a debit card;
- A direct debit can be set up from the bank account.
If loans were guaranteed without knowing some information about you, the lender may be lending money to someone underage who has no chance of being able to repay the loan back. This is a solid reason why loans cannot be guaranteed without first looking into the person’s background. It is a safeguard for the lender and the borrower.
Payday Loans Are Easier to Get Approval For Than Other Loans
The good news is that while there is no guarantee you will be approved for a payday loan if you have bad credit, this type of loan is usually easier to obtain than any other type of loan.
This is because the lender is not taking such a huge risk as the amount of money they are lending is small and you are agreeing to repay it quickly. A typical payday loan can be between £100 and £500 but some lenders might offer more. Either the loan is repaid in one payment on your next payday or it can be spread out for up to three months.
When working out the cost of payday loans the interest is added onto the sum of money borrowed daily. When you see the APR on payday loans, it can be shocking as it is usually upwards of 1000% but bear in mind that this is over the year as it is the annual percentage rate. Payday loans are usually repaid in one lump sum on the next payday or spread out for up to three paydays or months.
Questions Commonly Asked About Payday Loans
Here we aim to answer some of the most common questions regarding payday loans.
How Quickly Can Money Be Paid Into My Bank Account?
This is one of the most frequent questions asked by people considering payday loans. This is because many people who want a payday loan need to get hold of a small cash sum as fast as possible to pay for something that has cropped up unexpectedly.
If you are approved for a payday loan, you could get money paid into the bank within hours of first applying. This is going to depend on the lender and the amount you want to borrow, but usually, payment is no longer than the next day.
Is There Any Paperwork Involved?
Payday loans can be applied for online and as the sum of money being borrowed is small, the whole loan process is generally undertaken online. This means that there is no waiting for application forms to be sent out and the funds from the loan can be paid quickly into the nominated bank account.
I Am On Benefits Can I Still Apply For A Payday Loan?
As long as you have a regular income coming into the house and the lender thinks you can afford to repay the loan there is no reason why you cannot get a payday loan if you are on regular benefits. This is going to be down to the lender of course.
What is The Best Way to Apply for a Payday Loan?
Either you can search for lenders yourself by making an online search or you can apply for your loan with our help. We recommend the latter as there are many benefits to doing so and these include:
- You save time as you only have to fill in your details once for us to search with our panel of lenders to find you a lender willing to offer you a loan;
- As you are not making multiple searches and applications yourself, it is not going to have a negative effect on your credit rating;
- The lenders we work with offer numerous loan options;
- The lenders we work with offer competitive rates;
- The panel of lenders is huge so there is more chance of our being able to match you with a lender;
- The entire loan application is undertaken online and money could be paid into your bank within hours.
Finding a loan if you have a bad credit rating can be a nightmare if you do not have access to a huge panel of lenders. We can help to match you up with a lender quickly. Although there are no guaranteed payday loans for bad credit, your chances of being approved are greater when you apply with our help.