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Loans for bad credit

Applying for a loan with bad credit

  • Compare loans from across the market


Representative  23.3% APR

MoneySupermarket is a credit broker not a lender. You must be 18 or over and a UK resident.

Applying for a loan with bad credit

Whether it’s to pay for a new car to get to work or to cover a sudden and unexpected expense, sometimes you find yourself in need of extra cash. But if your credit score isn’t so good, your loan options may be limited. 

Luckily, there are still options available: depending on how much money you need, you might be able to find a loan from a provider which specialises in loans for bad credit. With so many lenders out there, the main trouble can be choosing the right option.

That’s where MoneySuperMarket comes in. We work with providers from across the market, performing what’s known as a ‘soft search’ to see which loans you might be eligible for, in a way that won’t hurt your credit score.

Representative 23.3% APR

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Types of loan for bad credit

If you’ve struggled with debts in the past and have a low credit score, you might be wondering what type of loan you’re eligible for. Even if your credit record and score are not in good shape now, it could still be possible to get a loan. Borrowing a small amount and making repayments on time is a good way to rebuild your credit score. Here are some loans you could consider: 

  • Secured loans

    The lender will require you to put up a valuable asset, usually your home, as security against your loan. Secured loans, sometimes referred to as homeowner loans, can be a way to borrow at competitive interest rates or APR if your credit score is low. But be aware your home is at risk if you default on your loan repayments.  

  • Guarantor loans

    Guarantor loans are designed for borrowers with very poor credit, who have few other options. The loan must be guaranteed by a family member or close friend, who promises to pay back the remainder of the debt if the borrower defaults. They often have high rates of interest, due to the extra risk. 

  • Personal loans

    Some personal loans are available to those with less-than-perfect credit ratings. There’s usually a strict limit to how much you can borrow, and you can expect much higher interest rates. This is because without collateral or a guarantor, banks are worried you may default and they’ll lose money.

Improve your credit score to get better loan offers

The loan deals you can get – and the interest rates – will be affected by your credit score. 

If you work on boosting your credit score it should lead to lower cost borrowing. There are many things you can do to grow your score – from quick wins, such as getting on the electoral roll, to longer-term habits, like always paying bills on time. 

Get a free copy of your credit file and score and see ways to start improving it today. 

Get my score 

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With a pre-approved loan, the deal you see is the deal you get

When you apply for a loan, it’s not always clear what deal you’ll be offered or whether you’ll be accepted. But when you’re pre-approved for a loan, you know the deal you see is the deal you’ll get – you’ll know where you stand, with information that will help you make the right choice.

  • Apply with confidence

    When you’re pre-approved, the loan amount, duration and interest rate are all confirmed

  • Tailored to you

    When you know what you’ll be able to borrow and how much it will cost, you can choose a loan that’s right for you

  • You’re in safe hands

    This helps protect your credit score as you’re less likely to be rejected when you apply

What to consider when taking out a loan with bad credit

No loan is offered without risk, both to the lender or the borrower. You should always think carefully before you take out a loan, but lenders consider those with lower credit scores as being in more danger of defaulting. Here are some things to think about:

  • 1

    Is the loan affordable?

    The lower your credit score, the more expensive the terms you are likely to be offered, and the less you can borrow. Be sure that the repayment schedule will fit into your monthly budget – and beware that higher interest means the loan is more expensive overall 

  • 2

    Defaulting will be costly

    The consequences of defaulting can be expensive, and might involve collections agencies, forced repayment plans or even legal action. However, if you keep on top of your repayments, you won’t get in any trouble at all 

  • 3

    Limits to what you can borrow

    Because bad credit represents a greater risk to the lender, you’re unlikely to be lent lots of money in one go. It’s wise to manage your own expectations of how much money you can – and indeed should – borrow, especially in light of the higher interest rate 

  • 4

    Your credit score is important

    Lenders will take other factors into account when considering you for a loan, including your income, how much equity you have in your home (if you want to use it as a security), and any outstanding loans you are still paying off 

  • 5

    Other details are considered

    Lenders will take other factors into account when considering you for a loan, including your income, how much equity you have in your home (if you want to use it as a security), and any outstanding loans you are still paying off 

  • 6

    You could improve your score

    If you manage to meet your repayment schedule in full and on time every month, your credit score will almost certainly rise as time goes on. The credit agencies like to see proof that people are borrowing responsibly, and this will help 

How to compare loans with MoneySuperMarket

Find the right loan for you and see which rates you’ll be guaranteed to get.

  • It doesn’t take long

    Tell us a little about yourself, your finances and the loan you want

  • We browse the market

    We’ll search through loans from a wide range of lenders on the market

  • Choose your loan

    You’ll be able to sort loans by the overall cost and the likelihood you’ll be accepted 

Whether your credit score is excellent or not, you get a loan in the same way: by applying to a lender. Once you make an application, they will assess your eligibility by looking at your credit score and circumstances.

If you have poor credit, you’re most likely to be eligible for loan offers from companies which specialise in bad credit loans.

That depends on your own specific circumstances. In some cases, if you own your home, you might find it easier to apply for a secured loan.

If you have poor credit and are struggling to find personal loans, guarantor loans might be easier – but they depend on having a friend or family member to vouch for you.

It’s very easy to check your eligibility for loans online, and it’s just as easy to apply for a loan. Certain providers might approve you quickly, though most people with poor credit will be subject to more thorough credit checks – which can often take 24 hours or more. You’ll be notified on whether you are successful either by phone or email.

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