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Last updated: 05 January 2023
Trying to get a loan with favourable rates can be a pain, and if you don’t have a great credit score, it can be even more challenging. This isn’t always ideal, as there are times in life when a short term cash injection is required.
Fortunately, some loans are easier to secure than others, and to give you an idea of which ones are going to be the simplest, we’ve put together this quick guide.
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If you need money quickly in an emergency, many people opt for payday loans. These, as the name suggests are designed to get you through to your next paycheck. This means that, generally, the repayment terms are very short, often between one and four weeks.
As they are designed for short term fixes, the amounts you can borrow are lower than other types of loans.
Like all creditors, payday lenders conduct credit checks before approving a loan. Failure to repay your debts on time can result in your credit rating being damaged, as well as your debts mounting very quickly.
On top of the APR, payday loans can come with flat fees, so make sure you check the small print before borrowing.
Personal loans differ from payday loans because you pay them back over a longer period. Rather than needing to return the full amount plus interest within say, a month, the repayment period with these is often over several months or a couple of years. This makes them more suitable for those who have a plan for the money, such as renovating your home or buying a car.
The amounts you can borrow with personal loans are also much higher, going up to around £25,000. However, they will generally fairly comprehensive conduct checks, so if you have a bad credit rating, you might find them difficult to secure.
Bad credit loans
As we’ve previously said, having a low credit score can hamper your ability to easily secure a loan. However, bad credit loan lenders are set up for exactly this. They specialise in dealing with individuals who may have had difficulty making payments in the past, or just lack any credit history to speak of.
However, there will generally be a credit score limit. The closer you get to it, the more interest/higher fees you will pay and if you’re below it, you might not get accepted.
If your credit is really low, you might either struggle to get a loan, or the interest will be so high that it’s not worth it. This is where guarantor loans come in.
They require you to find another party, with a better credit history who can essentially take out the loan on your behalf. While you still receive the money and make repayments, the guarantor is required to step in if you miss a payment.
So, while these loans might open doors when others have closed the requirement for another party might prevent them from being the easiest, depending on your personal circumstances.
What is my credit score?
Your credit score is an aggregate rating of your creditworthiness, rolled into one easy to understand number between 0 and 999.
When a lender is deciding whether to loan you money they will conduct a credit check and make a judgement. The number is based on all of your financial history and how well you’ve paid it back.
So, failing to make good on a phone contract, mortgage repayments and of course, other loans, will factor into this. If you want to get your score up, you will need to successfully make repayments. Sometimes people will purposefully take out loans for this exact reason.
If you want to check your credit score, the easiest way to do it is on the Experian website.
Things to consider
Before you take out a loan, it’s important to consider what you're going to be using it for and whether you can pay it back. Loans that are easy to get generally come with high-interest rates and can carry late penalties. So, ensuring you can pay it off quickly is vital to stop you from falling into debt.
How can I easily apply for a loan?
Once you’ve established that the loan is a good idea, how much you need to borrow and over what time period, you will need to have the following handy:
- Your monthly salary
- Your expenses, e.g rent, childcare, bills
- What address do you live at now, and is your address history
- Bank account details
- Contact information
- Date of birth
Now, all you need to do is use our loan comparison tool which can show you all the deals on the market available to you right now.