Once you are tagged as a bad credit borrower, it becomes quite difficult to source a fresh loan. Lenders refuse to approve further loans fearing non repayment. In the loan market, you will come across lenders who are offering financial assistance without giving any seconds on your credit history. Bad credit loans essentially provide you the funds through which you can fulfill the various needs. Not only this, you can also use the loans to replenish your financial position.
While availing these loans, it does not matter if you are having CCJs, IVA, arrears, defaults. Generally, bad credit occurs, when you have failed to manage your funds in an appropriate manner. It can also be due to loss of employment, transfer of job, sickness or skipping monthly payments towards past debts. The loan amount approved under these loans is a lot based on your income and repaying capability.
You can avail these loans in the regular format of secured and unsecured. To get hold of the secured form of the loans, you have to place one of your valuable assets as collateral. A large amount in the range of £5000-£75000 can be availed for a period of 5- 30 years. Pledging of collateral acts like an assurance for the lender and this in turn compels the lenders to offer these loans at comparatively low rates.
Unsecured form of the loans is tailor made for those who do not want to risk their asset and for those who do not have any. A limited amount in the range of £1000-£25000 is released, which has to be repaid within a period of 6months-10 years. Considering your bad credit status and unsecured nature, lenders approve the loans with a slightly high rate of interest.
You are free to utilize these loans for a varied number of purposes. It can be used for home improvement, purchasing a car, consolidating debts, wedding, educational purposes etc. Further, on timely repayment of the loan installments; you can improve the credit score.
Before availing bad credit loans compare and contrast the rate quotes of various lenders using the online mode. By doing so, you will be able to locate lenders offering the lenders with the best of terms and conditions.
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