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Bad Credit Loan

Are bad credit loans expensive?

It is fair to assume that a bad credit loan is likely to cost more overall compared to a personal loan for people with average to good credit. Lenders are privy to detailed information regarding your credit history and as such, will use their findings to assess your worthiness as a potential borrower.

Your credit history indicates what type of “risk” factor you present to a potential lender and will determine the overall cost of your loan. Ultimately the lower the risk, the lower the cost to you.

However there are ways of obtaining cheap loans even if you have bad credit. If you own your own home and secure the loan against your property, your credit becomes less of an issue and drives down the overall cost of the loan.

What information is on my credit file?

Your personal credit file paints a detailed portrait of you as a potential borrower. It shows what types of credit you have attained in the past (if any) and if you have made repayments on time, in full.

Your credit file will also show if you have had any defaults, CCJ’s, IVA’s or have been made bankrupt. All of which will determine what type of bad credit loan you are suited to.

Can I check my credit history before I apply for a bad credit loan?

If you are unsure of your credit history (as many people are), you can request a copy of your personal credit file from a credit reference agency. The cost of doing so is minimal (around £2.00) and it can be a worthwhile exercise

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WARNING: THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE
REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

1. 4.94% typical APR available with Zopa for a £1,000 loan for 36 months. Zopa only lend to people
with excellent credit, who earn over £25,000 and whose identity they can confirm.

2. Potential savings will vary depending on the amount you are borrowing, the rate
you are currently paying and the rate you may be eligible for.

3. Logos are used for illustrative purposes only and represent a snapshot of loan
plan providers available through associates of bestloans.co.uk.