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Your credit score plays a crucial role on whether you’ll get approved for a loan or not. A detailed report of your credit history, a good credit score is your ticket to loan approval, higher approved loanable amount, and lower interest rates.
Finding Bad Credit Lenders in the UK
There may be things you have done in the past that contributed to why your credit rating is low. You may have paid your bills late or cancelled credit cards that still have unpaid balances on them. You may not have managed your past debts well too or you may have defaulted on a loan.
What to expect from bad credit loans
Before you apply for a loan, it is advised that you first consider fixing your credit score. If the need for money is not urgent, you should consider spending time working on getting your credit score up. If you need cash fast, however, exploring some bad credit loan options would work for you. Note that bad credit loans will be different from standard loans due to how they are associated with higher loans fees and costs.
Loan option for bad credit borrowers
Since it is difficult to get approved for a standard loan when your credit score is low, you can try finding a guarantor instead. This is a person you know who has a good credit rating and who will take on the responsibility of paying off the loan if you are unable to pay it back.
Check if your bank offers unsecured loans. If you have been banking with them for a long time, they might trust you enough to grant you a personal loan. It will usually come with high fees though.
You can apply for a secured loan too. If you have a car or a property with considerable value, you can use this to secure the loan. Just see to it that you will pay the loan back or the lender can take the asset in order to recoup their losses if you will default.
When looking into a personal loan, there are various financial institutions that you can apply to. Depending on the financial institution that you have chosen, the time to process your loan application and to get your personal loan approve may last from just several minutes to many weeks. Let’s take a look at the different borrowers you can apply to.
When dealing with an ultimate emergency, looking into an online direct lender is one of my highly suggested choices as they usually take the fastest time to checking your loan application. In fact, filling up the application lasts no more than 10 to 15 minutes. Just be ready with the necessary information. In some cases, all it takes to get approved is a few minutes.
Peer to peer lenders
Much like online lenders, peer to peer lenders also take a relatively shorter time as opposed to financial institutions like banks and credit unions. Just be ready with your documents as well as information and there’s a big chance that you can get approved in just a few minutes.
Credit unions and banks
These two are reputable for taking a longer period of time to process your loan applications. As opposed to the two, credit unions and banks assess way more information before approving your loan. They check your credit standing such as if you have pending balance or if you regularly make payments on time. Since there is more at stake, applying for loans in credit unions and banks may take up to several weeks to process. This all depends on your credit standing.
How to get approved fast?
Generally, there are two main things you need to consider and maintain to get your loan application processed fast. First, if your credit history. As long as you maintain an excellent credit history by making your payments on time or having no recurring balances, then chances are you’ll get that loan immediately approved. Second is if you have a stable source of income that can cover your monthly loan payments, then you can prove your creditworthiness.