Guarantor loans are fine for some people with poor credit who have someone close they can ask to stand as the guarantor. These types of loans are one of the options for borrowing with a low credit score, but what are the alternatives to no guarantor loans UK?
More to the question are there are any alternative loans for people with less than a perfect credit score? The answer is yes. Of course, nothing is guaranteed in life so whether you would be approved for a loan would be dependent on the lender, the term you wanted to take the loan over and the amount of money you wanted to borrow.
Popular Choices of Loans for People with Poor Credit
Several types of loans might be available even if you have a poor credit rating. These include a payday loan, a short-term loan or a personal loan.
All You Need to Know About the Payday Loan
Some types of loans are generally easier to request and get if you have a poor credit score. Lenders are going to think twice about lending you thousands of pounds if they see you as being a big risk because of a poor credit score.
One of the most popular choices of loans for people with a poor credit rating who only wish to borrow between £100 and £500 is a payday loan, so we will start with that.
Why Are Payday Loans So Popular?
Payday loans are popular due to many reasons and these include:
- Even people with a poor credit rating may be able to get approval for a payday loan;
- The loan is short-term;
- The whole loan application can be undertaken online without paperwork;
- The fund from the loan is paid quickly;
- Numerous lenders offer quick payday loans;
- You can use a payday loan for just about anything.
People with Poor Credit Ratings May Be Approved
The first reason loans of this type are so popular is that even people with a poor credit rating find it easy to get approval for this type of loan. This is usually because the amount you are asking to borrow is relatively low and the loan is repaid back quickly, within three months.
We work with lenders who are prepared to offer small loans to people with a poor credit rating based on their current circumstances. Lenders will need to look at your credit rating, but they do not necessarily delve deeply into it. They will focus on the amount of regular income you have coming in, and what your monthly outgoings are, so they can determine whether you can afford the repayment of the loan.
The Loan Is Repaid Within One to Three Months
Originally, when payday loans came out they were offered to be paid back in a single installment on your next payday. Today, lenders will usually allow you to extend the cost of a payday loan over one to three months.
The faster you pay back the loan, the less interest you will pay for it. This is because lenders add interest daily. When you first look at the APR on payday loans, they may seem very high. This is because the APR is calculated over the year but you are repaying the loan in just a month or two. Therefore, the interest rate is not as extortionate as it looks.
The Application for No Guarantor Loans UK Takes Just Minutes
The entire payday loan application is undertaken online and it takes just a few minutes to fill in the application.
Lenders need a bit of information from you, such as your age, (you should be at least 18), where you live, (you need to live in the UK), your income, (you need a regular income), your outgoings.
After giving this information and choosing how much money you need to borrow and when you will repay it, you will know within minutes if you are accepted for a loan.
Funds from the Loan Are Paid Quickly
The funds from a payday loan are paid quickly into your designated bank account once you have been approved.
In many cases, depending on the lender and the amount borrowed, the money may be paid into your account within hours of you applying. This is essential of course when you need to get hold of money fast to pay for something unexpected that has cropped up.
Search for Your Loan with A Panel of Lenders
If you choose us to find your small loan, we can try to match you up with a wide panel of lenders in the UK.
This means only a single application is required for you to be in a position to gain access to a panel of lenders offering competitive rates and affordable loans with numerous loan options.
You Can Use Funds from A Payday Loan For Any Reason
The funds from a payday loan can be used for just about any reason as lenders generally do not ask why you want to lend a small cash sum.
You might have found yourself with an unexpected bill that has to be paid before your next payday. You might need cash to pay for a repair to a home appliance or a vehicle. You might even borrow a small amount of money to get yourself out of an unanticipated unauthorised overdraft, which would cost you a lot of money if you had to wait until payday to get back in the black.
The short-term loan is another type of loan that you might want to consider. With this loan, you can usually borrow between £100 and £500. The repayments of a short-term loan can usually be spread out for up to one year, but this depends upon the terms of the lender and how much you borrow. The short-term loan can also be applied for online and money may be paid into the bank on the same day.
A personal loan may be a suitable option if you wish to borrow anything up to £1,000 and spread out the cost of repayments for up to 36 months.
While people with a poor credit rating can apply for a personal loan, it is often one of the most difficult types of loans to be approved for if you do not want a guarantor loan. Personal loans are unsecured loans, which mean you do not need to secure your property against the loan.
The APR on the loan will affect how much interest you have to pay back on the loan. Generally, the lower the APR the less interest will be added onto the loan.
There are numerous alternatives to no guarantor loans UK, including payday loans, short-term loans, and personal loans. The one most suited to you will depend on the sum of money you need and how long you wish to pay it back. We can match you up with a lender from a wide range of lenders, all who offer affordable loans with competitive rates.