How to Get a Bad Credit Quick Loan in the UK?

How to Get a Bad Credit Quick Loan in the UK?

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How easy is it to get a bad credit quick loan in the UK? 20 or 30 years ago, the only real options open to someone with a bad credit record wanting to borrow money were pawnbrokers, and doorstep loan lenders. The advent of the high-speed internet and the popularity of smartphones have opened many more options to British borrowers today.

In this article, the 786 Loans team considers the following types of quick loans for bad credit:

  • pawnbrokers
  • logbook loans
  • guarantor loans
  • doorstep loans
  • unregulated lenders
  • bad credit quick loans

Pawnbroker

There are hundreds of pawnbrokers offering quick loans for bad credit in the UK – you’re almost certain, to find one or more in any larger town and dozens in the big cities. Pawnbrokers offer a type of secured loan – a secured loan is a type of loan for which you put something up against a loan that you’ll lose if you don’t keep up repayments.

The type of security you offer can be jewellery, electronic equipment, white goods, and so on. You’ll be offered around 60% of the value of your security – so, if you offer a plasma TV worth £500, a pawnbroker may lend you up to £300. If you have no security, you won’t be offered a loan.

You’ll agree, a length of time to pay your loan back with your pawnbroker. If you keep up repayments, you’ll get your security back at the end of the loan. If you don’t keep up repayments, then you’ll lose the item for good, and the pawnbroker will then sell the item at full price to cover the losses caused by your failure to keep up repayments.

Logbook loan

A logbook loan is similar to a pawnbroker, except that the security you must offer to them for your quick loan for bad credit is your car.

When you take out a logbook loan, the loan company takes ownership of your car. You then make your repayments to the logbook loan company to the agreed schedule. Once you have made the final repayment, the loan is closed, and ownership of the car is returned to you. However, if you fail to keep up repayments, you will lose access to the car forever.

Please think very carefully before taking out a logbook loan because, if you lose your car, it could make family and working life very difficult, particularly, if you live in more remote areas.

Guarantor loan

With a guarantor loan, you nominate another person, like a family member or a friend, who has an excellent credit record who promises to pay back the loan in full if you can’t.

If you don’t keep up repayments, then the guarantor loan company will approach your guarantor for the money. If your guarantor falls on harder times after you take the loan out and they can’t make repayments, you are both at risk of being taken to court, and of having County Court Judgements awarded against both of your names. This can put severe strains on any relationship you have with a guarantor and, for that reason, here at 786 Loans, we don’t believe that guarantor loans are desirable or responsible and we don’t offer to find them for our customers.

Doorstep loan

A “doorstep” loan is a type of quick loan for bad credit applicants where repayments are collected once a week by an account manager from your home. Many doorstep loans pay you in cash (rather than a bank transfer) and repayments are made in cash – they can really help people who don’t have a bank account.

Doorstep loan providers are generally very open-minded about the people they’re happy to lend money to. For first-time borrowers, doorstep lenders provide loans of between £50 and £1,000 – borrowers with a good track record can request up to £2,000 but whether they are accepted or not depends on the lending criteria of that particular company.

Unregulated lender

In the UK, all money lenders (and brokers) must be licensed by the Financial Conduct Authority (FCA). What the team at the FCA do is, to check that the people behind a lender or a broker can be trusted and they also provide a set of rules we all must work by. And just so you know, 786 Loans is licensed by the FCA.

Loan sharks operate outside the law – even by offering you a loan, they’re acting illegally. Loan sharks are infamous for using threats and intimidation against borrowers and for putting up interest rates beyond the levels agreed with a borrower. Many loan sharks are professional criminals and their lending money is one part of their criminal empire.

Whatever you do, never borrow money from an unregulated lender. If you have been approached by a loan shark, report them in confidence to the Illegal Money Lending Hotline. In Scotland, visit this website, in Wales call 0300 123 1124, or in Northern Ireland, call 0300 123 6262.

Bad credit quick loan

Arguably the most popular type of finance offering quick loans for bad credit applicants is payday loans and short-term loans. Payday loan and short-term loan companies generally invite borrowers to apply via their websites or their mobile phone apps.

With a payday loan, you pay back the amount of money you borrow plus the interest all in one go – usually within 30 days of your application. Short-term loans allow you to pay back your loan over 12 months – that means that your loan repayments each month are a lot lower, however, the longer you take a loan out for, the higher the interest you pay back on the loan.

Apply for quick loans for bad credit at 786 Loans

It’s easy to apply for a quick loan for bad credit applicants here with 786 Loans. We don’t lend you the money ourselves because we’re a broker. What brokers do is, work with a range of lenders and we represent you when dealing with those lenders.

There are dozens of different quick loan providers in the UK and, for borrowers, it can be confusing to know which lender to choose when you want to make an application. Where we help is that each of the lenders on our panel has told us who they want to lend money to. When we receive your application, what happens then is that, together with your credit report, we “package” your application, sending it to only those lenders we feel confident will want to work with you.

Our service is free, and the best reason for choosing us is that we can identify the cheapest quick loan on the market from our panel of lenders – and we do it in second. To start your application, please click here.

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