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Getting a secured loan with bad credit
You may find it difficult to be approved for a personal loan if you’ve got bad credit. But you could still get a secured loan. This is because some lenders are more open to approving loans if you are a homeowner or have other valuable assets to put up as security – even if you have a less than perfect credit history.
We can help you find the best deals on secured loans with our partner Fluent Money. Even better – searching won’t harm your credit score.
How much you can borrow will depend on your income and outgoings and your credit score. All lenders will have different criteria, although broadly the better your credit score the better rates and terms you’ll be offered – and you’re more likely to be able to borrow a bigger loan. You’re also likely to be able to borrow more than with an unsecured loan because you are putting your home as security for the lender.
Our loan calculator can show you how much a secured loan would cost you at different interest rates or APRs – so you can be confident you can afford your monthly repayments before you apply. Remember to only ever borrow what you can afford to pay back.
Improve your credit score for better loan deals
From getting on the electoral roll to paying bills on time and reducing how much you borrow each month – credit monitor’s helpful hints can get you on the path to stronger credit and cheaper borrowing.
We’ll need to know a bit about you. Make sure you register yourself as a homeowner to see secured loans in the results
We’ll show you the loans you’re eligible for – if you choose a secured loan you’ll need to register your interest with our partner Fluent
Fluent Money will contact you to discuss your secured loan options
When you take out a secured loan, a condition of the loan is that you put up an item of high value as security in case you fail to keep up with repayments. If you are a homeowner, in most instances this will be your house. Other lenders may offer loans against other assets (like your car), but with our partner Fluent Money only your home can be used as collateral.
A secured loan may be easier to get than an unsecured loan if you have bad credit. This is because the provider has the security that they can lay claim to the collateral you put up, for example, your house, if you fail to keep up with repayments. This is why a secured loan agreement should not be entered into lightly.
Yes. Each lender will have their own terms for what loan applications they’ll approve, but while a secured loan might give them more confidence to lend to someone with bad credit, it is not a guarantee.
If you keep up with repayments and prove you can responsibly handle credit, then a secured loan can help you improve your credit score over time. If your goal is simply to improve your credit score though, you may be better off considering a credit-builder credit card.
This will depend on the provider. Some lenders may allow you to pay off the loan early, but many will charge an early repayment charge. It’s always best to check the terms for early repayment before signing up to the loan in case your financial situation improves, and you are in a position to pay it off early. Even if there is a charge, you may still be better off clearing the outstanding balance rather than continuing to make monthly repayments.
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