People obtain a poor credit rating for many reasons and while you might have earned a bad rating many years ago, it takes some time to restore your rating to good form. In the meantime, if you wish to take out a loan without having to ask someone to stand by your side and sign for the loan with you, you might find it difficult. Luckily there are options for loans for poor credit no guarantor and here we are going to look at those options.
Applying online for a loan is the quickest way to determine if you can borrow money with a poor credit rating. There is no waiting around for approval as everything is undertaken online and you know within minutes if you have approval. It takes minutes to complete the application with just a few details and if approved money is paid into your bank account fast, often on the same day.
What Are the Options for Loans for Poor Credit No Guarantor?
There are some alternatives to the guarantor loan for people with poor credit. One type of loan that people with bad credit typically apply for is a payday loan. Another popular type of loan is a short-term loan. Several factors will determine whether you might be able to get a personal loan, including your income and outgoings.
There are lenders who realise that your circumstances might have changed from many years ago when you fell behind on a couple of payments or earned a CCJ. The panel of lenders we work with will look into your income and outgoings to determine if they think the loan is going to be affordable to you.
Why You Might Want To Consider a Payday Loan
Payday loans are among the easiest to find approval for thanks to the amount of money borrowed being small and you are agreeing to repay the loan within one to three months. Usually, lenders offer between £100 and £500 with payday loans but this is at the lender’s discretion and your income and outgoings will to some extent; determine how much you can borrow.
When applying for a payday loan, you can choose to spread the repayments over three paydays or pay it back on the next payday. This may be a suitable option for people who have a very bad credit rating and want to borrow a small amount of money.
Why Choose A Short-term Loan?
With the short-term loan, you might be able to borrow between £500 and £1,000, depending on the lender.
As the name suggests the short-term loan is repaid within a short time-frame and this is generally up to 12 months. This enables you to spread the cost of borrowing to ensure the loan is affordable but the longer the term of the loan the more it is going to cost you overall with interest added on.
Short term loans are popular and in 2018 around £4 billion was given out in short term loans by lenders in the UK.
You Might Be Eligible For A Personal Loan
Your credit rating along with the amount of money you have coming in each month and what you have to go out is going to determine whether you might be approved for a personal loan.
A personal loan does not need a guarantor and this is an unsecured loan so your home is not at risk. It allows you to borrow up to £5,000 spread out for up to 36 months. As the sum of money is generally more than with the short-term or payday loan lenders are stricter when approving loans.
Choose Your No Guarantor Loan with Our Help
Bonsai Finance is not a lender. Instead, we work alongside a panel of UK lenders offering numerous loan options. We can help to match you up with a lender and if you do not get approval from the first we will go to the next lender, all from you making a single loan application.
Applying for Loans for Poor Credit no Guarantor
We have talked about the types of loans you might be able to apply for with a poor credit rating that does not require a guarantor and now we will look into how you can apply for a loan online.
First, you have a responsibility to ensure that you are eligible to even apply for a loan. The criterion is the same with all lenders with the basic criteria:
- You have a regular income paid into the a bank account in the UK;
- Being over 18;
- Having a UK address;
- A Bank account in your name and debit card.
Lenders generally state that you must have a regular income and this can be confusing. Does this mean that lenders will only consider you if you are in work?
The lenders we work with will consider anyone who has a regular income coming into the household. By a regular income, we mean an income from a job that is paid into the bank on a regular basis or money from social security benefits.
While lenders will consider people on benefits, there are some types of benefits not considered. These are such as:
- Housing benefit;
- Child support;
- Job seekers allowance;
- Pension credit.
Types of benefits that lenders may consider as an income may include:
- Incapacity benefit;
- Family allowance;
- Working tax credit;
- Fostering income;
- Disability living allowance/disability working allowance;
- Industrial injuries disablement benefit.
Just because your type of benefit is not included in the list, does not automatically mean that the lenders we work with will not offer you a loan. If you are unsure about whether the benefit you are on make you eligible or not to apply for loans for poor credit no guarantor contact us to find out more.
5 Steps to Applying for a Loan
We make applying for loans very easy. We work alongside a panel of UK lenders who consider all circumstances regardless of their credit rating. To apply for a loan simply:
- Use the sliders on our homepage to choose how much you want to borrow and how long you would like to take the loan over by clicking on the “Find me a loan” button. Alternatively you can choose “loan” from the dropdown box and the reason you want the loan;
- Click the “Request your loan now” button;
- Fill in your personal details;
- We will try to match you up with one of the lenders from the panel that we work with;
- Check out the details of the loan, repayments and other information then sign up.
Things to Bear in Mind When Looking For Loans for Poor Credit No Guarantor
It is important to note that if you are looking for a loan for poor credit without a guarantor that the interest rate is going to be higher than it might be for someone with a good credit rating. On saying this, you can expect some of the most competitive rates from the lenders we work with.
Lenders we work with do offer some of the most competitive rates on loans. Generally, you can expect interest rates to fall somewhere between 35.9% and 1304% APR. The rate is going to depend on your credit history and the type of loan offered.
Payday loans accumulate interest over days rather than the year. This is due to fact that payday loans are only taken out for short periods; typically, they are paid back within 1 to 3 months. With this in mind never take a payday loan out for longer than is really needed, but at the same time make sure the repayment is affordable as the money will be taken out of your bank in one amount the next time you get paid.
While we work alongside a panel of lenders, which means you gain access to a wide range of lenders, which increases the chances of our being in a position to match you with a lender, we do not guarantee loans for poor credit no guarantor. Whether or not you will be approved, will depend on whether the lender thinks the loan is affordable, and other factors.