It’s frustrating. You can afford it but your cash flow is tied up. And you badly need that car repair, that essential purchase, or you have to make an urgent payment to your supplier. If your bank and credit card company are not helpful, consider bad credit loans to tide you over.
Poor credit scores could be due to simple mistakes, like forgetting to pay your electricity bill. Traditional institutions penalise you mercilessly without considering an individual’s circumstances. Companies offering bad credit loans don’t check your credit records. They don’t even ask what is the reason for your loan! Instead, they offer short term loans with repayment tenures up to 12 months if you can demonstrate:
1. your ability to repay. Show that you have a regular income. Usually this means proving that you are salaried, although some companies do extend credit to self-employed individuals too. If you earn above £1,000, you should be safe.
2. you have an existing bank account. The account needs to be older than 3 months. Having your wages directly credited into this bank account will increase your success at securing credit.
3. your wages are regular and frequent. Are you paid weekly? Monthly? The more regular and frequent, the better.
4. you are a citizen of the UK.
If you cannot meet some of these conditions you may still get the loan if you can offer something valuable as collateral, like a house or a car. Alternatively, find a friend or a family member who is financially stable to co-sign your application.
As with all loans, don’t be lazy. Shop around and look for a loan with the lowest interest rates, although this consideration may sometimes be offset by a loan that offers you some other form of advantage, like greater flexibility in repayment. Check if the interest rate is fixed; avoid those that aren’t. Check if there is a fee, and if yes, ask how much.
