Bad Credit Loans - Borrow up to £5,000 with Poor Credit

If you’re looking for a loan for bad credit, we can help! Our poor credit loans help people with little to no credit history, and those who have suffered adverse credit in the past. Apply for loans for poor credit today with ThisLender.

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NO OBLIGATION & NO BROKER FEES

Representative 49.9% APR

Representative example: Amount of credit: £1200 for 18 months at £90.46 per month. Total amount repayable of £1628.28 Interest: £428.28. Interest rate: 49.9% pa (variable). 49.9% APR Representative. Rates from 45.3% APR to 1721% APR - your no-obligation quote and APR will be based on your personal circumstances. The minimum repayment period for any loan will be 90 days from the date the loan is issued. The maximum repayment period is 3 years.

We are a credit broker, not a lender

Bad credit loans are designed to help anyone with a less than perfect credit score. They can also be used in the event you have not yet built up a solid credit history, or if you have been refused a loan in the past.

We help people with poor credit access personal loans from £50 to £5,000. By analysing your overall affordability, our lenders are able to approve finance regardless of credit score.

If you’re new to loans for bad credit, take a read of our complete guide below.

A guide to bad credit loans

Just because you have bad credit, doesn’t mean you can’t secure a loan. Getting hold of a traditional bank loan with poor credit can be tricky, but there are other loan options out there that you might not yet have considered.

For example, online lenders can help people access loans through alternative finance solutions. Many of these providers offer options for bad credit, but as with any loan product, it’s essential to do your research before making any decisions.

Bad credit loans are a high-cost, short-term credit option that is growing in popularity in the UK. However, before taking out this product you must be sure that you can realistically afford it. According to the Financial Conduct Authority (FCA), borrowers are due to repay on average 1.65 times the amount they borrow.

What are bad credit loans?

Bad credit loans are a type of finance specially designed for applicants with a poor credit history. Typically, if you have bad credit, you will struggle to secure a traditional loan, and that’s why personal loans for bad credit exist, to help those who can’t access money the traditional route.

But what is classed as bad credit? If you’ve got a history of failing to make repayments on time, you’ve declared bankruptcy, or you’ve received a country court judgement - these are all reasons you might have bad credit.

You may also be classed as having ‘bad credit’ if you have no evidence of previous successful borrowing. Believe it or not, applying for finance without having built up a credit history can also be difficult, so you may need to consider a loan for bad credit.

You need to be mindful, though, bad credit loans can carry higher interest rates. They also have more restrictions, and you might need to provide a guarantor to co-sign the loan agreement with you.

Couple applying for a loan for bad credit

How can I get a loan with bad credit?

If you’ve done your research and decided that a bad credit loan is the best option, it’s time to make an application. Loans for bad credit are usually provided by alternative lenders online, which means you can complete all the necessary documents from the comfort of your home.

  1. Apply with a UK lender

    This is a straightforward step! Before applying, you need to make sure you meet the lender's criteria which can be found on their website. Applications are made online and can include information such as personal details, income and expenditures.

  2. Lender reviews application

    The lender will check and verify your application to make sure the details are correct and that you can afford to pay back the loan (this is particularly important with a bad credit loan as they offer higher interest rates!). They will also perform a credit check on you. This decision is made quickly, although sometimes they may ask you to send in more documents.

  3. Review your loan offer

    If you are successfully approved, you will be presented with a loan agreement. The lender may offer you less than what you initially applied for. Please review this carefully and make sure you are happy before deciding to accept it or not - after that, there’s no turning back!

  4. Receive money

    If you accept the offer, you will receive the funds directly into your chosen bank account, sometimes within 10 minutes² after approval. That’s fast access to cash!

  5. Repayments

    Payments might be made in monthly instalments for a few months or years, depending on the agreement and the amount you borrow.

If you’re struggling with debt management and you’d like to seek impartial, free advice - visit MoneyHelper (formerly the Money Advice Service).

What types of loans can I get with bad credit?

If you have poor credit, the loan options available can be limited. However, there are some loan products that are better suited to people with bad credit. There are a few types of bad credit loans to consider:

Short-term loan

A short-term loan is just that - short-term. You’ll pay back the money borrowed within months - usually under a year. This type of loan could be a good option if you need cash fast to pay unexpected bills, cover necessary expenses or in an emergency loan situation.

However, when considering a short-term loan for bad credit, you should be aware that due to the temporary nature of this loan type, combined with bad credit, they can result in higher interest rates.

Secured loan

Secured personal loans allow you to use your home or an asset as security against the loan. Using collateral can be an excellent way to raise much higher loan amounts at better interest rates, but be careful, if you miss a repayment or fail to repay the loan, you could be at risk of losing your property.

Secured loans for bad credit can be easier to obtain because the lender has more assurance that they will be able to reclaim their money in the event you default on the loan repayments. So while this loan product could result in lower interest rates, the risk for you as the borrower is greater.

Guarantor loan

A guarantor loan is a popular loan product for people with bad credit. Often, lenders will ask you to provide a guarantor for the proposed loan agreement. Essentially, you and a relative or trusted friend will need to apply for a loan together.

The person you choose as your guarantor must have a good credit score, and on signing the agreement they become legally responsible for payments in the event you are unable to pay.

Peer-to-peer loan

Peer-to-peer lending, sometimes called social lending, is an increasingly popular way to access cash, particularly if you have poor credit. You’re matched with a ‘peer’ - bypassing banks and building societies. This peer is usually an investor, who lends money via a P2P platform at competitive, often lower interest rates.

What are the benefits of bad credit loans?

Just as with any financial product, bad credit loans have advantages and disadvantages. It’s important to be aware of both the benefits and potential risks, before making your decision. The benefits of bad credit loans include:

  • Access vital funds to cover financial emergencies: These loans for bad credit provide options for people who otherwise wouldn’t be eligible to borrow.
  • Receive the money you need quickly: Alternative finance providers are able to approve and release funds quickly, usually within 10 minutes² after approval.
  • Rebuild your credit score: Put your bad credit history in the past - if you make the agreement payments on time, borrowing money can help to improve the score on your credit file.
  • Little spending restrictions: Usually, you can choose how you spend the borrowed money, so long as it isn’t used for anything illegal. Despite not having restrictions, it’s important to remember that bad credit loans should only ever be spent on financial emergencies.

What are the risks of loans for bad credit?

Before deciding to take out a bad credit loan, it’s important to be aware of some of the disadvantages and potential risks associated with this loan product:

  • Higher interest rates: Each lender charges their own annual percentage rate (APR) that you need to be aware of before accepting a loan agreement. These rates tend to be higher for people who have adverse credit, so it’s extremely important to calculate your loan with the interest included.
  • Commit to monthly repayments: If you fail to meet your payments month to month, you will further damage your credit score and reduce the likelihood of being able to apply for finance in the future.
  • Extra fees and charges: Because each lender offers different terms, you need to look out for things like early repayment fees, and initial loan charges. These costs can increase the total amount owed to your chosen lender, so should be included in your initial calculations.
  • Guarantor may be required: If a lender decides you need a guarantor to co-sign the loan agreement, you will need to find someone willing to help you secure funding.

What are the alternatives to bad credit loans?

Before jumping into signing a bad credit loan agreement, it’s important to sit down and think about whether you truly need a payday loan for bad credit. It’s always a good idea to go through a checklist, and ask yourself:

  • What am I going to spend the money on? Is it a necessary payment?
  • Do I need to make this payment immediately? Or can I save up for it over time?
  • Can I borrow the money from elsewhere? Such as family members or friends?

Just so you know! At ThisLender, we only work with FCA-registered UK direct lenders. We’re a broker, and that means our service is completely free of charge to our customers.

Apply for a bad credit loan

How much can I borrow with bad credit?

The loan amount you can borrow with bad credit will vary depending on the lender and your affordability. Generally, your credit score will have an impact on how much you can borrow.

For example, if you have a low credit score, lenders may offer smaller loan amounts. Be aware that they will also attract much higher interest rates than if you had a good credit rating.

When you apply for a bad credit loan through ThisLender, you could be eligible to borrow up to £5,000.

How can I check if I have a bad credit score?

It’s important to regularly check your credit file and be aware of your credit score. There are lots of credit reference agencies that allow you to do this - so be sure to sign up to platforms like Experian, Transunion or Equifax.

Most online credit reference services will offer a free service such as ClearScore of Credit Karma, but some may charge you a fee to access a full report.

Can a bad credit loan improve my credit score?

Yes, a bad credit loan can help improve your credit score providing you pay the loan back on time as specified in your agreement. Taking out loans can be a good way of proving yourself as a reliable borrower.

However, if you miss a payment or fail to repay the loan, this will further harm your credit score. Damaging your credit file will limit your chances of getting credit in the future, so it’s important to be sure you will be able to repay your poor credit loan.

What is the best loan for bad credit?

The best loan for bad credit depends on your personal circumstances and financial position. The research stage is important in determining the right loan product for your situation, and when doing this you must compare lender offers to ensure you get the best deal possible on your bad credit loan.

Am I eligible for a loan with bad credit?

Each lender will have their own criteria, but regardless of your credit score, you must meet basic eligibility requirements such as:

  • UK resident over the age of 18
  • Have regular income
  • Have a UK bank account

Lenders will also assess your application on affordability. They will take your income and outgoings into account to make sure you can afford to pay back the loan amount you have requested.

How can I get a loan for bad credit with no guarantor?

We understand that some borrowers are not in a position to ask a friend or family member to become a guarantor for a loan. The good news is that there are lenders that offer loans with no guarantor even if you have poor or very bad credit.

Loans that don’t require a guarantor can include:

It’s worth taking the time to compare bad credit lenders and understand what their requirements are before you go ahead and apply.

Where do I go for help if I’m in financial difficulty?

If you are having financial difficulties or need to speak to someone regarding your financial situation before applying for a loan you can get free and confidential advice from MoneyHelper (formerly The Money Advice Service), National Debtline or debt charity StepChange.

Get your free loan quote today

Access from £50 to £5,000

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Representative 49.9% APR

Representative example: Amount of credit: £1200 for 18 months at £90.46 per month. Total amount repayable of £1628.28 Interest: £428.28. Interest rate: 49.9% pa (variable). 49.9% APR Representative. Rates from 45.3% APR to 1721% APR - your no-obligation quote and APR will be based on your personal circumstances. The minimum repayment period for any loan will be 90 days from the date the loan is issued. The maximum repayment period is 3 years.

We are a credit broker, not a lender.

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