Bad Credit Loans
A poor credit history doesn't rule you out. The lenders we work with mostly look at whether you can manage a loan today – not at the mistakes you've made in the past.
Who can apply?
Almost everyone. The only real barriers are bankruptcy – whether you're applying for it, going through it or not yet discharged – and Debt Relief Orders (DROs). Our partner lenders can't consider you while either is in place, and the law requires you to tell any lender about them before you borrow. Apart from that, we accept applications from everyone, and every application is treated in exactly the same way – whatever your credit history looks like.
In an Individual Voluntary Arrangement (IVA)? You can still apply, and lenders will consider you. But check your IVA's terms first: most limit new borrowing, and breaking them could put your arrangement at risk.
The lenders we work with are used to lending to people who aren't "perfect" on paper. They accept that most people have had problems at some point: the odd missed payment, or even the odd County Court Judgment (CCJ), isn't enough to stop you being considered.
What lenders really look at
The big question today isn't what your credit score is. It's whether the repayments are affordable for you. Lenders look at your recent incomings and outgoings, and if they show the loan is affordable, you can be considered. In our experience, the decision comes down to roughly:
Your history counts as long as you're not bankrupt or subject to a DRO, and there's no "gone away" marker on your file.
What worries lenders
Usually it's simply that the repayments wouldn't be affordable on your current income and outgoings. If that's the case, a lender won't – and shouldn't – lend.
The "gone away" marker
The one thing on a credit file that really concerns lenders. It means someone stopped communicating with a lender and left a debt unpaid, with no payment plan in place. Lenders can cope with past difficulties; what they can't cope with is not being able to reach someone.
They also notice signs that might point the same way – frequent changes of mobile number, email address or where you live. Keeping the same contact details for as long as you can helps your application.
Can a loan help rebuild your credit?
Yes. Repayments on these loans are reported to the credit reference agencies, so every payment you make on time adds to a better credit record. The reverse is also true – missed payments will make it worse – so only borrow what you're confident you can repay.
Imagine someone who's just been offered a new job, but needs a car to get there. A bank won't help – they can't see the new salary coming in yet, and the person's credit history isn't spotless.
But with a job lined up, there's a clear path to repaying a loan. A lender may be able to help, and that loan gets them to work: it helps them, and it helps the lender.
Before you apply
Make sure you can afford the repayments. There's no point making a difficult situation worse by borrowing more – it doesn't help you, and it doesn't help the lender either.
If you're struggling with loans you already have, contact those lenders first: they can often restructure what you owe. A loan is only the right answer for a problem where you can see a clear way out. You can also get free, confidential advice from MoneyHelper.
Worried about your credit score? Getting a quote only uses a soft search, so it won't affect it – read more in our guide to no credit check loans, or compare all our loans.
Representative example: £1,500.00 borrowed for 12 months. Monthly repayment is £154.12, total repayable is £1,849.47. Total cost of credit £349.47. Representative 49% APR. Credit broker not a lender. All loans are subject to status and only available to UK residents over the age of 18. Warning: Late repayment can cause you serious money problems. For help, go to moneyhelper.org.uk