Personal loans for bad credit
Having a bad credit rating does not mean that you are disallowed from obtaining personal loans…far from it in fact. There is a whole stack of specialist lenders out there just waiting for your call or e-mail, all of whom will be willing to consider your application for a personal loan even though you might have CCJs, mortgage arrears or IVAs registered against your name.
Unsecured personal loans of up to £25,000 and secured personal loans of up to £80,000 are readily accessible by people with a bad credit rating. They can be applied for over the telephone or online, some lenders even guaranteeing that you'll be accepted for their personal loan before you apply! For borrowers with bad credit problems it's just a matter of knowing where to find these specialist lenders.
Finding specialist lenders of personal loans for bad credit
Specialist lenders of personal loans for bad credit are easily tracked down on the Internet. Simply visit a personal finance web site or loans portal and you'll find offers from a collection of lenders that specialise in personal loans for bad credit.
Some of the lenders you may not have heard of, but don't let that put you off. Providing that the loans companies are licensed credit brokers and allow themselves to be regulated by the Financial Services Authority (FSA), then you should have few worries about arranging a personal loan through them. If you want to check the authenticity of a personal loans company then you can do so by consulting the FSA register at http://www.fsa.gov.uk .
What to expect with personal loans for bad credit
When choosing personal loans for bad credit you'll often be presented with the same selection of products as mainstream borrowers. There will however be a few differences. The first thing to expect with personal loans for bad credit is that the interest rate applied to the loans are likely to be higher than the rates on standard personal loans. For both unsecured loans and secured loans the APR - that is the annual percentage rate of interest that you'll pay on bad credit personal loans - could typically be between 2% to 4% for people with a bad credit history.
The second thing you'll notice is that very rarely will you be offered the headline rate of interest as claimed on the advertising. This is because the rate offered is based on the applicant having only minor aberrations in their credit history and taking out a loan for the lowest amount over the shortest timescale possible. Each application for bad credit personal loans is assessed individually on its own merits. To get a better feel for the interest rate you're likely to be offered it is best to look at the lender's typical APR.
Finally, if you have serious bad credit problems don't be surprised if the amount of personal loan you can take out is capped by the loans company. Your choice of personal loans products may also be limited because of the perceived risks associated with your bad credit rating.