When you have a bad credit score, you would most likely have a hard time getting help with your finances, such as securing loans, getting credit cards, mortgages, or any other financial products. If you are one of the very few who are lucky enough to get approved for such, you would face very high-interest rates. It is important to know your options when you are in real need of quick cash, especially if you have a bad credit score so that you would not be faced with ludicrous interest rates and repayment schemes that would only sink your finances further below. But, there are many different financial providers out there that offer loans to people with bad credit.
Guarantor Loans
The most common loans on the market for those who suffer from a bad credit rate are guarantor loans. If you apply for a loan with a guarantor, the approval of your loan application would not rely on your credit score nor what you could offer as collateral, but it would be dependent on the credit standing of your guarantor. That is why it is important to choose a guarantor with a good credit standing. If you want to apply for a larger valued loan, a guarantor who is a homeowner with a good credit standing will give you better chances of approval than a guarantor who is only a tenant, even though he has a good credit score. If you have a guarantor who is only a tenant in his place of residence, you would be able to loan amounts ranging from £1,000 up to £10,000. But if you need a larger sum, a guarantor who is a homeowner would be able to have you accepted for loans up to £15,000.
Find a Guarantor
Guarantor loans may look and sound very easy to come by, and they actually are; once you get a guarantor that you could trust! In fact, when applying for a guarantor loan, the hardest step to take is finding someone who could act as your guarantor. It may be tricky, but as long as you follow a simple checklist, it’s straightforward to achieve. The one thing you have to remember is that anyone who is 18 to 75 years old could act as your guarantor when you apply for a loan. The important thing is they fit these important criteria for fast approval. First and foremost, your guarantor would be responsible for paying for your monthly repayments in case you fail to do so, so it is essential to get someone who you know and trust would be able to do it and fix the terms with you on how you would repay them. Secondly, you should make sure that they have a good credit standing and they do not have trouble paying their bills. Lastly, your guarantor should have a home in the UK, their home does not need to be outright, and even a mortgaged property is okay.
Loan Terms
With TFS Loans, you could enjoy flexible loan repayment terms that would not leave you in a worse situation than what you began with. For loans starting from £1,000 to £1,500, you could have a minimum repayment term of up to 12 months up until 36 months. For larger values of up to £5,000, you could pay it off starting at a minimum of two years up to as long as 60 months. For loans amounting to £6,000, you could pay it off for a minimum of 36 months and for as long as 60 months. For loans with a bigger value of up to the maximum amount of £15,000, you could pay it off for as short as 48 months or for as long as 60 months. The representative APR that you would get could be as low as only 29.9%, depending on the amount value of your loan, and how long you would be paying it off. These factors would also be where the affordability of your monthly loan repayments would highly rely on.
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