Three Types Of Loans For Which People With Bad Credit May Qualify

Three Types Of Loans For Which People With Bad Credit May Qualify

Bad decisions or credit mistakes needn’t keep you from getting the loan you need to repair your car, consolidate your debts, or even purchase a new vehicle, as there are several types of loans you may be eligible to receive. You may be able to obtain some of these loans on your own, but others may require a guarantor. Here are some loans you may be able to qualify for despite a bad credit history.

Payday Loans

If you need to get cash quickly to pay for a car repair or to cover your bills before your next payday, you can get a payday loan to cover those expenses. Most payday loans come in small amounts, usually no more than £1,500, which can be repaid in two weeks to thirty days, or sometimes up to three months, depending on the amount borrowed. Most payday loans do not require a credit check; you simply sign an agreement to repay the loan or have the amount withdrawn from an account via a check, which you give them.

Guarantor Loans

If you need more money to purchase a vehicle, make renovations to your house, or simply take a well-deserved vacation, you can apply for a guarantor loan and borrow up to £15,000. With guarantor loans, you have anywhere from two to five years to repay them, and all you need is a friend or family member to sign the loan with you. If you default on the repayments, they will be responsible for ensuring that the loan is repaid.

Unlike payday loans, institutions providing guarantor loans will run your credit to see if you are qualified for the loan. However, they are a type of quick approval loan because you will usually get a decision made about your application and have funds transferred to your account within 24 hours, as long as your guarantor has the following qualities:

  • Owns a home in the UK
  • Is at least 18, but no older than 78
  • Has an income

If these are true of your guarantor, then you should be approved for the loan.

Logbook Loans

If you own a vehicle, even just a motorbike, you may be able to borrow money by using it as collateral. You still get to keep the vehicle and drive it, but it can be repossessed if you don’t make the loan repayments. One of the biggest advantages to this type of loan is the ability to choose how the repayments are made. You can choose weekly, bi-weekly or monthly repayments until the loan is repaid in full.

Some lenders offer logbook loans from £250 to £50,000, depending on the type of vehicle you own. Most decisions requiring loan applications are made right away and some lenders will provide as much as £5,000 to you in cash with the rest being sent to your bank account. If you need cash to fix your car, pay for an emergency at home, or renovate your house, there are many types of unsecured and secured personal loans from which to choose, even if you have a bad credit history.