Anyone with a bad credit rating may find it more difficult to obtain a loan if they do not want a guarantor loan. If they are also on benefits, they may find it even more difficult. So what are the chances of obtaining loans for bad credit no guarantor on benefits?
While there is no guarantee that you will be able to obtain approval for a loan if you have bad credit and you are on benefits, the lenders we work with will consider your circumstances. While lenders will check your credit rating, they are also swayed by your ability to repay the loan.
What Types of Benefits will Lenders Take into Account When Looking for Loans for Bad Credit No Guarantor on benefits?
When you request a loan, lenders will want some information from you. They will generally want to know the following:
- That you are over the age of 18;
- You are a resident of the UK;
- You have a bank account with a debit card;
- You have a regular income coming in.
By a regular income, lenders mean money being paid into your bank account on a recurring monthly basis. This can be an income from work you are in or from benefits. Benefits that lenders may consider include:
- Family tax credit or working tax credit;
- Any fostering income you receive;
- Family allowance;
- Disability working allowance;
- Industrial injuries disablement benefit;
- Severe disablement benefit;
- Incapacity benefit.
These are the main types of benefits that lenders will generally consider being a regular income. Just because your particular benefit is not on the list it does not mean that lenders will not consider your loan application.
What Types of Loans Are Available Without a Guarantor
The guarantor loan is one of the easiest types of loans to be approved for if you do have a bad credit rating. However, there are downsides to a guarantor loan with the biggest being that you have to talk about your financial situation with a friend or relative. Luckily, there are alternative options for loans and these include the short-term loan, payday loan and personal loans.
A Payday Loan Is the Easiest Loan to Find Approval For With Bad Credit
A payday loan is one of the easiest types of loans to find approval for if you have a bad credit rating. The reason is that you are only asking for a small amount of money and, you are agreeing to repay it back within a short time frame.
Whether a payday loan would be suitable would depend on the amount you want to borrow, and how soon you can repay it. Lenders will generally offer between £100 and £500 with a payday loan. The loan is paid back on your next payday or you might want to spread it out for up to three paydays.
A payday loan is a great type of loan if you need to get your hands on money fast, generally within hours, to meet any financial outlay that has cropped up unexpectedly.
Short-term Borrowing For Up to One Year
Short-term loans are generally taken out for up to one year. Most lenders will offer between £500 and £1,000 with a short-term loan and the funding from the loan can be spent on anything you want.
The amount of interest you have to pay will be fixed at the time of taking out the loan so you know exactly how much you will have to pay over the term of the loan. As with any loan the APR will vary between lenders and usually the lower the APR the less interest will be added onto the sum borrowed.
You May Be Able to Get a Personal Loan
If you need to borrow more than £1,000 and up to £5,000, you might be able to apply for a personal loan. This loan does not need a guarantor and you might be able to spread out the loan for up to 36 months.
Again, interest is added onto the loan on a yearly basis, so the least amount of time you take the loan over, the less you will pay in interest.
Fast Online Loan Application with Instant Decision
If you want loans for bad credit no guarantor on benefits and you want to get an instant decision with a fast application, apply online. We work with a panel of lenders who consider all circumstances and who offer affordable loan options with competitive rates.