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Best Loans for Bad Credit in the UK – November 2024

A less-than-perfect credit score won’t necessarily stop you from getting a loan. We’ve rounded up NerdWallet’s analysis of the best loans for bad credit, to help you compare their features.

Many or all of the products and brands we promote and feature including our ‘Partner Spotlights’ are from our partners who compensate us. However, this does not influence our editorial opinion found in articles, reviews and our ‘Best’ tables. Our opinion is our own. Read more on our methodology here.

You may still be able to get a loan for bad credit even if you have a poor credit history. Bad credit loans are a type of personal loan offered by specialist lenders that accept applications from people who have a bad or limited credit history.

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NerdWallet has partnered with Monevo. Check your eligibility from a range of loan providers without affecting your credit score.

Best loans for bad credit November 2024

The best loans for bad credit in our table below are listed by Annual Percentage Rate (APR), from lowest to highest, based on the lender’s representative example. If lenders offer the same representative APR, we’ve ordered the loans by our star rating, which considers factors such as customer service and the ease of the application process.

The interest rate you receive will depend on your financial situation, your credit history, how much you borrow and how long you choose to repay the loan. Only borrow what is essential and if you can comfortably afford repayments.

What to consider before applying for a bad credit loan

Bad credit loan providers don’t always refer to their products as loans for bad credit, but bad credit lenders often share features to look out for, such as:

  • advertising loans with high interest rates 
  • saying you can apply even if you’ve struggled with credit in the past
  • claiming that your credit history or score won’t be the most important factor when deciding on your application

Loans for people with bad credit usually come with higher interest rates. You’ll also have a more limited choice of loans than someone with a better credit score, so it’s important to compare bad credit loans to find the most suitable one for your circumstances. It’s also possible that after comparing loans, you decide a bad credit loan isn’t the right option for you after all. 

You can find out what loan deals you’re likely to qualify for, and the loan rate you’re likely to receive, by checking your eligibility using a loan comparison service. To get a personalised quote, you’ll need to enter details such as your income and employment status.

If you’re not sure whether you have a good or a bad credit score, you can check your credit score for free before applying for a loan. Your credit score gives you an idea of how a lender may view your application. Checking it can help you apply for credit that you’re confident of getting, as multiple credit applications over a short time can damage your credit score.

You should only borrow what you need and pay it back as quickly as possible, based on what you can comfortably afford to repay each month. Before applying for a loan, it’s important you consider whether you could keep making repayments if an unexpectedly high bill lands on your doorstep or you lose your job, for example.

Compare loans using the representative APR

To help you see how expensive a loan is, lenders will display the APR, which tells you the total cost of a loan over one year, including interest charges and fees. You should consider this, as well as other key elements, to help you compare loans for bad credit and decide whether a particular loan is right for you.

The advertised APR is known as the representative APR, and this is the rate that at least 51% of applicants will receive. Your personal APR could be higher, lower or the same as this rate.

What is a representative example?

The figures in our table below show the cheapest bad credit loans based on the lenders’ representative APR example. A representative example illustrates how much it will cost to borrow a certain amount over a specific term, it shows: 

  • An example borrowing amount, such as £5,000.
  • An example loan term, for example, 60 months.
  • The annual interest rate and whether it’s fixed or variable.
  • A monthly repayment amount and the total repayable over the loan term.
Swipe to the left

Provider

Representative APR

Loan Amount

Loan Term

NerdWallet’s Rating

25.8%
Representative Example
£2,000 to £10,000 1 to 5 years 4.0 / 5
33.8%
Representative Example
£1,000 to £25,000 1 to 5 years 4.0 / 5
34.9%
Representative Example
£3,000 to £20,000 3 to 10 years 3.0 / 5
39.9%
Representative Example
£500 to £5,000 1 to 3 years 2.5 / 5
42.2%
Representative Example
£1,000 to £5,000 1 to 2 years 2.5 / 5
49.7%
Representative Example
£2,000 to £15,000 1 to 5 years 3.5 / 5
49.9%
Representative Example
£1,000 to £5,000 1 to 3 years 3.0 / 5
64.80%
Representative Example
£1,000 to £5,000 2 years 3.5 / 5
79.5%
Representative Example
£500 to £1,200 12 or 18 months 3.0 / 5

Late repayments can cause you serious money problems. Consolidating multiple debts into one loan can extend the term of your borrowing and increase your cost of borrowing.

Important information: APR is checked weekly with data supplied by the independent financial information service Defaqto. We aim to provide accurate information but prices, terms and conditions of products and offers can change, so double-check first. Our Star Ratings do not consider the product provider’s lending rates and therefore do not reflect how much it costs to borrow from the reviewed brand. Loan rates can be dependent on your personal circumstances and specific loan requirements.

What does NerdWallet’s star rating mean for bad credit loans?

We regularly check the loans for bad credit market, evaluating and reviewing a number of the UK’s bad credit lenders. We rate their loans based on 20 of the features that customers have told us are most important. These include:

We regularly check if a product or lender has changed any of these features, and we’ll update its star rating as needed. You can use the star rating when comparing personal loans for bad credit, helping you to work out which lenders score well for a range of product features.

However our star ratings don’t reflect how much it costs to borrow money, because a rating doesn’t take the APR offered by the lender into account. Some loans for bad credit can come with very high interest rates. Always check and compare a lender’s rates against others on the market when considering a bad credit loan. 

What is a bad credit loan?

Bad credit loans are designed for people with a bad credit score, which could be caused by past money troubles or a limited credit history. Because people with bad credit are viewed as a higher risk by lenders, they can find it more difficult to access loans and other types of credit. This is where specialist products such as bad credit loans could help.

Bad credit loans often have higher interest rates than standard personal loans, as well as lower maximum loan amounts and terms. 

You can use bad credit loans for many different reasons, such as car repairs, emergency expenses, or to consolidate your debts into one single repayment. Debt consolidation is likely to make the loan more expensive in the long term, but it can sometimes make the monthly repayments easier and some find managing one payment, instead of several, easier to keep track of. 

Some people take out a bad credit loan, or a credit builder loan, to try to improve their credit score to show they can manage debt responsibly. But, if you do this, you need to be certain you can afford to repay the loan in full and on time.

What is bad credit?

If you have bad credit, it means the data held by credit reference agencies (CRAs) about your credit history could indicate that you won’t be able to successfully manage your repayments.

Having bad credit may mean you have made late payments, missed payments, or defaulted on credit in the past. You may also have an individual voluntary agreement (IVA), a debt relief order (DRO), or a county court judgment (CCJ).

You may also be judged to have bad credit if you haven’t been able to build up a credit history, if you are young or if you’ve recently moved to the UK, for example.

The three main CRAs have different scoring systems, so there is no single figure to indicate you have bad credit.  These scores and definitions are decided by the CRAs and can change. At the time of writing, the CRAs judge someone to have “poor credit” if they have the following scores.

To further complicate this, each lender will also have its own criteria for what it considers to be bad credit and this will affect your eligibility from one lender to the next. 

But once your credit file reaches a certain point, for example evidence of an IVA, you will need to spend some time rebuilding your score before you consider applying for more credit. 

» MORE: What is a bad credit score?

Types of loans for bad credit

Bad credit loans come in various forms. It’s worth spending some time researching these different loan options to make sure you choose the right one for your situation.

Personal loans for bad credit

There are various lenders that will consider offering a personal loan to people with bad credit histories. Personal loans are unsecured and will often come with higher interest rates than loans that offer some form of security. To qualify for an unsecured loan, you will have to meet other eligibility criteria, such as having a steady reliable income, and be able to afford the repayments.

Secured loan

Although secured loan providers tend to offer larger sums of money over a long period of time, they are often less strict about borrowers’ credit ratings as the loan is secured against a property or other high-value asset, such as a car. If the borrower fails to repay, the lender has the option to force the sale of the property or goods to get back the money they’re owed, so there is less risk to the lender. This means interest rates can be lower than on an unsecured loan.

For borrowers, however, there is a risk that you could lose your home, so it’s vital that you are confident you can meet the repayment responsibilities before committing to a secured loan with bad credit.

Guarantor loans

A guarantor loan is when your application is backed by another person (usually a friend or family member). If you have a close family member or friend who is financially stable and has a good credit score, they can opt to act as a guarantor for your loan

Although you are the borrower, your guarantor agrees to cover the cost of the repayments if you are unable to. Both credit files would be negatively affected if the loan is not repaid on time. 

Debt consolidation loans

This is actually a description of what you might use a loan for. By merging different loans into a single loan, you can simplify your repayments with a bad credit consolidation loan. These loans come with a single level of interest from one lender, as opposed to maintaining multiple rates from multiple lenders on different debts. 

However, bear in mind that consolidating your debts may mean you pay more in interest overall. Debt consolidation loans can be secured or unsecured.

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Check your eligibility from a range of loan providers without affecting your credit score, including:

Other loans may be available in the UK loans market that are not included in this service.

Pros and cons of loans for bad credit

Bad credit loan advantages

Bad credit loan disadvantages

What to consider when taking out a bad credit loan

Before applying for a bad credit loan, you should think carefully about whether it is the best option for you.

When you take out a loan, you are taking on a debt that will need to be repaid so you need to be confident that you can afford to borrow this sum of money.

To help you decide whether a bad credit loan is right for you, ask yourself:

How to get a loan with bad credit

Before you think about getting a loan, you should work out a budget so you know how much you can afford to repay each month. This will help you when you start looking at different loans as you know how much you can afford to borrow. 

You may also want to check your credit score to see if there are any easy ways to improve it, as a better credit score will help you to get a more competitive loan.

If you’re thinking of applying for a loan, check the eligibility criteria of the lender. Every lender has different requirements, with some only accepting applications if you earn above a certain income.

As a minimum, most lenders will require applicants to be at least 18 or 21 years old and a UK resident.

You can often check your eligibility for a loan before you formally apply. Checking your eligibility won’t affect your credit score and it allows you to see how likely you are to qualify for different loans, reducing your chances of applying for an unsuitable loan.

You should only formally apply for a loan if you are confident of being accepted, as loan applications will appear on your credit history and could affect your score.

To apply for a loan, you will need to provide the lender with personal information and details about your finances, such as your:

Lenders will also run a hard credit check as part of your application. This will be recorded on your credit history. Multiple applications will have a negative effect on your score so make sure you only apply for loans you feel confident of successfully getting.

Can you build your credit score to get better rates?

A better credit score can help to increase your chances of getting approved for a loan and being offered better rates of interest. 

There are a number of ways to improve your credit score, including:

Alternatives to bad credit loans

Before applying for a bad credit loan, it’s worth considering if there could be a more suitable option for your situation.

Credit union loans

A credit union loan could be an option if you’re struggling to get approved for a loan elsewhere. Credit unions are not-for-profit organisations that could help people who find it more difficult to access services from traditional financial providers. You need to be a member of a credit union to apply for a loan. The interest rate that credit unions in Great Britain can charge on a loan is capped at 3% a month or 42.6% APR. The cap is 1% a month or 12.68% APR in Northern Ireland.

Budgeting loans and advances

If you receive universal credit or certain benefits, you may be eligible for a budgeting loan or budgeting advance. These are loans from the Department for Work and Pensions (DWP) that don’t charge any interest. The amount you could borrow will depend on your individual situation.

Credit cards

A credit card can allow you to spend only the amount you need and, if you pay it off in full each month, you won’t pay any interest. You may be eligible for a credit card with a bad credit score, such as a credit builder card, but you may face higher interest rates and lower credit limits. Bear in mind that if you don’t pay off your balance, credit cards can be an expensive way to borrow.

Friends and family

If you have close friends or family, you could think about asking them to lend you money. While this can be a cheap way to get the cash you need, you should consider your personal relationship with the individual lending the money. It may be worth drawing up a written contract, so both parties agree on how and when the money will be repaid.

What if borrowing money isn’t the right option for you?

Borrowing money isn’t always the answer. If you’re struggling to afford your living expenses or finding it hard to make payments on any existing forms of credit, it’s worth asking for professional debt help. There are several debt charities that can offer free support and guidance on your situation, including:

Lenders for poor credit loans: NerdWallet’s top picks

We’ve assessed 41 loan products in the UK and this is our roundup of the best bad credit loans of those, ordered by representative APR. If two lenders offer the same representative APR, the loans are ordered by our star rating. Representative APR does not factor into our star rating methodology. There are other loans available on the market not included in our roundup, and it does not include loans that are only available to existing customers. Find out how we use the term ‘best’ and our guide to star ratings.

The Representative APR is provided to help you compare loans by cost and is not factored in the star rating methodology.

Abound Personal Loan

4 NerdWallet's ratings

1 to 5 years

£2,000 to £10,000

25.8%

No

Representative APR 25.8%. Based on a loan of £2,000 over 36 months at an interest of 20.2% p.a.(fixed). Monthly repayments of £77.95. Total amount payable £2,805.76 (includes £130 fee).

  • Must be aged 18 or over.
  • Must have at least one UK bank account.
  • Must not have unresolved defaults or CCJs.
NerdWallet's Review Summary A loan from Abound scores well for the flexibility it offers borrowers, giving you the option of settling your loan early without any extra charges.

Once approved, you can receive your money fairly quickly, and there are multiple ways to get in touch with Abound’s customer service team. Read more in our Abound Loan Review

Amount borrowable£2,000 to £10,000
Term lengthOne to five years
Time to get a decisionUp to two working days
Time to receive funds once approvedSame day
Customer supportPhone, live chat, email, text
NerdWallet's Pros & Cons

Pros:

  • You may not need to pay interest charges if you settle your loan early.
  • You could get your loan on the same day your application is approved.
  • There are multiple ways to contact Abound for help and support.

Cons:

  • It charges a non-refundable loan fee, which is added to your total loan balance.
  • It could take up to two working days to get a decision on your application.

NerdWallet has partnered with Monevo who will check your eligibility.

Lendable Personal Loan

4 NerdWallet's ratings

1 to 5 years

£1,000 to £25,000

33.8%

No

Representative APR 33.8%. Based on a loan of £7,500 over 36 months at an interest rate of 28% p.a. (fixed). Monthly repayments of £316.09 and total fees of £400. Total amount payable £11,379.16. Maximum APR 49.9%.

  • Must be aged 18 or over.
  • Must be a UK resident.
  • Must have a current account at a UK bank or building society.
  • Must have an income of at least £800 per month
NerdWallet's Review Summary Lendable’s loan scores well for its application process, which is fairly quick – once approved, you could have the funds in your account within two hours.

You can also choose your payment date when applying, which can be useful if you want to align it with your payday, for example. Read more in our Lendable Loan Review

Amount borrowable£1,000 to £25,000
Term lengthOne to five years
Time to get a decisionInstant
Time to receive funds once approvedWithin two hours
Customer supportPhone, email
NerdWallet's Pros & Cons

Pros:

  • You can get your loan within two hours after your application is approved.
  • You can choose your repayment date when you apply for the loan.

Cons:

  • Lendable charges a non-refundable loan fee as standard. You will pay this as part of your monthly repayments.
  • Lendable may apply interest charges to pay off your loan early.

NerdWallet has partnered with Monevo who will check your eligibility.

Norwich Trust Personal Loan

3 NerdWallet's ratings

3 to 10 years

£3,000 to £20,000

34.9%

No

Representative APR 34.9%. Based on a loan of £12,500 over 66 months at an interest rate of 30.31% p.a. (fixed). Monthly repayments of £391.14. Total amount payable £25,815.24. Maximum APR 37.9%.

  • Must be a homeowner.
  • Must be aged 21 or over and under 71 at the end of the loan.
  • Must have been a UK resident for at least 2 years.
  • Must have a net annual income of at least £15,600.
NerdWallet's Review Summary While Norwich Trust offers unsecured loans, you have to be a homeowner to apply for one. Its application process is also relatively slow when compared with other lenders we’ve reviewed.

Read more in our Norwich Trust Loan Review

Amount borrowable£3,000 to £20,000
Term lengthThree to five years (ten years for larger amounts)
Time to get a decisionOne to three working days
Time to receive funds once approvedSame day
Customer supportPhone, email
NerdWallet's Pros & Cons

Pros:

  • The maximum loan amount of £20,000 is higher than some bad credit lenders we’ve reviewed, but keep in mind that you should only borrow what you need.
  • You can choose to repay your loan over a term of 10 years, which is longer than most bad credit lenders that we’ve reviewed. However, a longer term means that you will pay more in interest overall.

Cons:

  • You need to be a homeowner to apply, but your property won’t be used as security.
  • It could take two or three days to get a decision on your application.

NerdWallet has partnered with Monevo who will check your eligibility.

Finio Personal Loan

2.5 NerdWallet's ratings

1 to 3 years

£500 to £5,000

39.9%

No

Representative APR 39.9%. Based on a loan of £2,000 over 24 months at an interest rate of 39.9% p.a. (fixed). Monthly repayments of £116.07. Total amount payable £2,785.68. Maximum APR 69.9%.

  • Must be aged 18-73 years old.
  • Must be a UK resident.
  • Must have a UK personal bank account.
  • Must be confident you can afford the monthly repayments.
NerdWallet's Review Summary You can apply for a loan from Finio of between £500 and £5,000, and there are a few ways to get in touch with Finio’s customer service team.

Read more in our Finio Loan Review

Amount borrowable£500 to £5,000
Term lengthOne to three years
Time to get a decisionWithin 24 hours
Time to receive funds once approvedSame day (if approved before 3pm)
Customer supportPhone, live chat, email, text
NerdWallet's Pros & Cons

Pros:

  • You could get your loan on the same day Finio approves your application.
  • There are multiple ways to contact Finio for help and support.

Cons:

  • Finio will apply interest charges if you want to pay off your loan early.

NerdWallet has partnered with Monevo who will check your eligibility.

Loans by Mal Personal Loan

2.5 NerdWallet's ratings

1 to 2 years

£1,000 to £5,000

42.2%

No

Representative APR 42.2%. Based on a loan of £2,300 over 24 months at an interest rate of 22.4% p.a. (fixed). Monthly repayments of £138.77. Total amount payable £3,330.48. Maximum APR 92.4%

  • Must live and work in the UK and be between the ages of 21 and 75 at the term of the loan
  • Must earn at least £1,300 per month
  • Must pass creditworthiness and affordability checks
NerdWallet's Review Summary You can apply for a loan of between £1,000 and £5,000 from Loans by MAL, but the lender won’t be able to give you an instant decision.

Read more in our Loans by MAL Review

Amount borrowable£1,000 to £5,000
Term length12 to 24 months
Time to get a decisionWithin 24 hours
Time to receive funds once approvedWithin one working day
Customer supportPhone, email
NerdWallet's Pros & Cons

Pros:

  • Loans by MAL says it doesn’t charge any settlement fees if you pay off your loan early. 
  • Once approved you could receive your funds within one working day.

Cons:

  • The lender won’t be able to give you an instant decision.
  • Longer loan terms are available from other lenders we’ve reviewed.

NerdWallet has partnered with Monevo who will check your eligibility.

Bamboo Personal Loan

3.5 NerdWallet's ratings

1 to 5 years

£2,000 to £15,000

49.7%

No

Representative APR 49.7%. Based on a loan of £2,500 over 24 months at an interest rate of 41% p.a. (fixed). Monthly repayments of £154.38. Total amount payable £3,703.74. Maximum APR 69.9%.

  • Must be aged 18 or over.
  • Must be a UK resident.
  • Must be able to afford monthly repayments.
  • Must not be bankrupt.
NerdWallet's Review Summary With Bamboo you can choose to repay a loan over five years, which is longer than some lenders we’ve reviewed. But while repaying a loan over a longer term can mean smaller monthly repayments, it could cost you more in interest overall.

Read more in our Bamboo Loan Review

Amount borrowable£2,000 to £15,000
Term lengthOne to five years
Time to get a decisionA few working days
Time to receive funds once approvedSame day (if approved before 3pm)
Customer supportPhone, email
NerdWallet's Pros & Cons

Pros:

  • You could get your loan on the same day your application is approved.
  • You can change your payment date during the loan term.

Cons:

  • You may need to pay interest charges to settle your loan early.
  • It can take a few days to get a decision on your application.

NerdWallet has partnered with Monevo who will check your eligibility.

118 118 Money Personal Loan

3 NerdWallet's ratings

1 to 3 years

£1,000 to £5,000

49.9%

No

Representative APR 49.9%. Based on a loan of £2,000 over 24 months at an interest rate of 41.2% p.a. (fixed). Monthly repayments of £123.64. Total amount payable £2,967.43.

  • Must be between the ages of 18 and 70
  • Must have a minimum yearly income of £8,400
  • Must be employed or self-employed
  • Must be a UK resident and hold a current UK bank account and debit card
NerdWallet's Review Summary If you take out a loan with 118 118 Money, you can download its mobile app to manage your loan. Read more in our 118 118 Money Loan Review

Amount borrowable£1,000 to £5,000
Term lengthOne to three years
Time to get a decisionUsually within 60 minutes
Time to receive funds once approvedWithin two hours
Customer supportPhone, email, app
NerdWallet's Pros & Cons

Pros:

  • You could get the money in your account within a couple of hours.
  • 118 118 Money has a mobile app that you can use to manage your loan.

Cons:

  • 118 118 Money will apply interest charges if you want to pay off your loan early.
  • A loan with 118 118 Money comes with limited flexibility compared to some lenders we’ve reviewed.

NerdWallet has partnered with Monevo who will check your eligibility.

Munzee Personal Loan

3.5 NerdWallet's ratings

2 years

£1,000 to £5,000

64.80%

No

Representative APR 64.8%. Based on a loan of £3,000 over 24 months at an interest rate of 30.72% p.a. (fixed). Monthly repayments of £201.80. Total amount payable £4,843.20.

  • Must be aged 21 years old or above
  • Must be a resident of the UK
  • Must have a UK personal bank account
NerdWallet's Review Summary A loan from Munzee (formerly known as Minty) scores well for its flexibility. You can choose your payment date when you apply and if you want to settle your loan early, you won’t face any extra interest charges.

Munzee is fairly limited when it comes to available terms, offering loans of between £1,000 and £5,000 over 24 months. Read more in our Munzee Loan Review

Amount borrowable£1,000 to £5,000
Term length24 months
Time to get a decisionInstant
Time to receive funds once approvedSame day
Customer supportPhone, email, live chat
NerdWallet's Pros & Cons

Pros:

  • Munzee could pay your loan into your account on the same day it is approved.
  • You can pay off your loan early with no penalty, and no additional interest charges once the balance is paid off.

Cons:

  • You can’t see if you’re eligible for a Munzee loan without affecting your credit score if you apply for a loan with it directly.

NerdWallet has partnered with Monevo who will check your eligibility.

Salad Money Personal Loan

3 NerdWallet's ratings

12 or 18 months

£500 to £1,200

79.5%

No

Representative APR 79.5%. Based on a loan of £1,000 over 18 months at an interest rate of 59.97% p.a. (fixed). 17 monthly repayments of £81.64 followed by a final payment of £79.58. Total amount payable £1,592.94.

  • Must be employed by your current employer for at least 6 months
  • Must be over 18
  • Must be paid monthly, rather than weekly
  • Must be earning over £1,500 per month
NerdWallet's Review Summary Salad Money provides loans for key workers – including those employed in education and the NHS – who may find it difficult to secure credit through mainstream lenders.

Salad Money doesn’t look at credit scores. Instead, it uses open banking data to decide on someone’s creditworthiness. Read more in our Salad Money Loan Review

Amount borrowable£500 to £1,200
Term length12 months or 18 months
Time to get a decisionOne working day
Time to receive funds once approvedWithin 24 hours
Customer supportPhone, live chat, email
NerdWallet's Pros & Cons

Pros:

  • There are no charges to pay off your loan early.
  • You can get in touch by phone, email or live chat.

Cons:

  • It can take one working day to get a decision on your application, and a further 24 hours before you get the money in your account.
  • The amount you can borrow is more limited compared to other lenders.

NerdWallet has partnered with Monevo who will check your eligibility.

Best bad credit loans methodology

NerdWallet has evaluated and reviewed several consumer bad credit lenders in the UK.

We considered 20 data points for each loan, based on the criteria that matter most to customers, scoring them on loan features, flexibility, application process and availability of customer support, among other factors. This information was gathered from each lender’s website, company representatives and independent financial product analyst Defaqto. In addition, we regularly add new brands and our editorial team reviews them against the same criteria for consistency and accuracy.

Using the same data across all products and features, we were able to create star ratings, presented on a scale of one to five stars, where a one-star score represents ‘poor’ and a five-star score represents ‘excellent’.

Late repayments can cause you serious money problems.

Consolidating multiple debts into one loan can extend the term of your borrowing and increase your cost of borrowing.

Bad credit loans FAQs

What loans are easiest to get with bad credit?

Loans from specialist bad credit lenders are likely to be easier to get if you have a bad credit history. Depending on your circumstances, you could also improve your chances of acceptance if you apply for a secured loan or a guarantor loan. The extra security of these loans can give the lender more reassurance that they will get their money back.

However, you should consider the risks involved with these types of loans before applying. For example, secured loans come with the risk that you could lose your property if you fail to repay the loan.

What can I use a bad credit loan for?

You can use a bad credit loan for a variety of reasons. Lenders will often ask what you plan to use the loan for as part of their application process.

Will anyone lend me money with bad credit?

Certain online lenders may be able to offer you a loan if you have bad credit. However, this will depend on your individual circumstances and factors such as your income. Many lenders will allow you to check your eligibility for a loan, so you can see how likely you are to be accepted before applying.

Will applying for a bad credit loan affect my credit score?

Possibly. Whenever you apply for a loan, the lender will conduct a hard credit check, which will be recorded on your credit history. This could temporarily affect your credit score, but if you make your repayments and manage your other credit commitments responsibly, your score should recover.

Making several applications for credit within a short space of time is likely to damage your credit score, because lenders may think that you rely on credit to stay afloat. 

Can I get a loan without a credit check?

All authorised lenders have to run affordability checks as part of the application process for a loan, which in most cases, will involve a credit check. However, you can often check your eligibility for a loan without a hard credit check.

There may be some lenders that may not run a credit check at all, and assess your ability to repay a loan in other ways. But always double check that the lender is authorised before taking out a loan.

Borrowing from a family member or friend could be an option if you need money but want to avoid a credit check. However, you should consider the possible risks involved and only borrow from someone you know and trust. Never borrow money from someone that you don’t know as they could be a loan shark.

What can I do if I’m rejected for a loan?

If your loan application is declined, don’t try to apply for another loan straight away. Applying for a loan involves a hard credit check, which will appear on your credit history, and multiple applications could affect your credit score.

Instead, it’s a good idea to check your credit score and try to work out why your application was rejected. You can then take steps to improve your score, which should hopefully improve your chances of getting accepted for a loan in the future.

Can I get a loan if I have a CCJ?

It may be possible to get a loan with a CCJ, but this will depend on the lender and your individual situation. Some lenders won’t lend to you if you have a CCJ, but other lenders may consider your application. However, they will only offer you a loan if they think you can afford to repay it in full. You are likely to be charged a higher rate of interest if you are approved for a loan.

Think carefully before borrowing any money, and consider whether it’s the right option for you. It may be more appropriate to wait and improve your credit score or get professional debt help, for example.

Review methodology

At NerdWallet UK, we base our reviews and our ‘Best’ pages on the results of surveys we undertook about what was important to people who use these products. This allows us to look at products impartially of any commercial arrangements we have and fairly rate the products on the same set of criteria.

Best means our ‘Best’ and is based only on what products we have aligned to our surveys, which form the basis of our reviews and ratings. This means that there will be other products on the market that we have not included in our ‘Best’ pages. Best does not mean it’s best for you, nor does it mean the ‘cheapest’.

Our reviews may display lenders’ rates. This additional information has not been included in our evaluations but is still very important when choosing a product. Rates offered can depend on circumstances, amount and term. Always check details before proceeding with any financial product.

Product details reflect the information that was available at that time but may have changed since. We strive to give you a review on as many products as possible, but there will be products not included on the market. The review is our opinion, but it does not constitute advice, recommendation or suitability for your financial circumstances.

While we try to provide you with accurate information, the providers can change the terms of their products at any time, therefore it is advisable to check the terms before you proceed.

You can view our full review methodology here.

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