Types Of Loans You Can Apply For With A Bad Credit

Whenever there is a state of emergency, everyone looks out for some solution. Most of the people turn towards banks to seek help but a majority of these peoples are refused by the bank. The major refusal of these banks is that they require good and fair credit scores otherwise you are not eligible for the bank loan. At this moment of time, you are not able to improve the scores because of the urgency of money, therefore, you must seek different other options rather than these bank loans. So, here are the different types of options available for the loan when you have a bad credit score. Let’s have a look at these options.

  • Logbook Loan: one of the safest and the most reliable option to consider for the loan if you have a bad credit is the logbook loan. This is the loan given to you against the vehicle that you owe. But one of the most important condition for this type of loan is that you must be the registered owner of the vehicle that you have in the United Kingdom. Logbook loan is the best option to consider when you need money in an emergency situation. The lenders of these loans offer the most optimum interest rates that are easy to pay. Along with these, it is completely your choice to select the duration which you think you will be able to repay. The best part with the logbook loan is that you will not need to give your car to the lender as you are getting the money against it. You can use your car as much as you can until you defaults any of the payments of the lender.
  • Payday Loans: these loans are the best type of loans if you need for a short time. The duration of these payday loans is not more than two or three weeks. These loans are the unsecured type of loans when they are needed for the poor credit ratings. Moreover, the interest rates of these loans are also very high. These loans, as they contain a large amount, are sometimes difficult to pay. Therefore, you must assure that your budget is allowing you to receive this loan for only a short term.
  • Guarantor Loan: unlike the logbook loans, these loans are given to the borrower in the presence of a guarantor who equally signs the agreement with the borrower and the lender. A guarantor is the person who takes the responsibility of paying back the loan when the borrower is unable to pay the repayments or if he defaults it. He can be your family member, your friends or maybe your colleague. The guarantor must assure that he is in the right place, otherwise, most people use this type of loans as a trap for the guarantors. The guarantor has to pay all the money if the borrower fails or he is not financially able to pay it back.