Low credit score loans are available in different forms – as an unsecured loan, as a secured loan, and even as a mortgage. A low credit score lender will typically target people who have an average-to-poor credit rating. A typical customer will have been late on a payment, perhaps have a CCJ against their name, or have a large number of credit cards & loans in their name over a short period of time.
What you want from a lender will depend on your current situation. You are most likely already aware that you won’t be able to get a market leading APR with your loan, or even close to it. You should first consider what type of loan you want. If you want to borrow over £500 then a personal loan should probably be your first choice, even if you are a homeowner. If you have trouble paying back a personal loan you are much less likely to lose your home than you are with a secured loan. Plus the APR probably won’t be too different between these types of loan. If you only want to borrow a small amount of money, say below £500, then a payday loan may be a better option for you.
The money from a payday loan can be with you in hours; with a secured or personal loan it can take days or weeks. The APR will be much higher with a payday loan, but because you pay it back over a short period, the actual cash amount you repay is low compared to other types of loan. Personal and secured loans are typically paid back over a period between 6 months and 25 years. This means your monthly payments will be low, but you end up paying back a lot of interest.
Remember to consider your circumstances properly before deciding on taking out a loan.
Try Loanexplorer for low credit score loans.
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