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The more times you apply with different lenders, will result in a worsening credit score. With this method you apply directly to the company you are looking to borrow the money from.Ī key issue arising from this method is that in most instances when applying for a bad credit payday loan through a direct lender, whether your application is successful or unsuccessful this will be recorded on your credit history. They will also be able to tell you how likely you are to be successful in your loan application. The credit broker will scan the market and put forward options that not only meet your requirements, but also the loans with the best terms such as lowest interest rate. By using a credit broker, you will enter your personal details and the amount you wish to borrow, and the repayment terms you are looking for, just once. Bad Credit Loans from Credit BrokersĪ credit broker has access to the majority of the lending market.
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You can apply for a payday loan by using a credit broker or by approaching a specific lender directly.
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You will need a regular income to apply for a bad credit payday loan. Therefore, this type of loan is considered high cost which you should take into account when considering applying for this type of loan.Īs a responsible loan broker, we at Omacl advise you that as with any borrowing you should only consider applying for a bad credit Payday Loan if you are certain that you can afford the repayments and are in position to fully repay the loan and punctually. A bad credit payday loan is charged at a higher rate of interest than a conventional bank loan, to offset the higher level of exposure to risk for the lender. Should I considering applying for a bad credit Payday Loan?Ī person with bad credit will inevitably be considered at higher risk of defaulting on repayments than a person with a good credit history. Generally, all lenders will check your credit score before agreeing to a loan. The lower your credit score is, the poorer your credit history is. Your history with credit is electronically analysed to give a personal credit score. What does bad credit history look like?Ī poor credit history can arise due to unpaid bills such as phone bills or missed payments on finance, by not being on the electoral roll, by not having any credit history, or even just by association such as a shared address with someone who has a bad credit history. Trustworthy and reputable payday loan brokers, like Omacl, that offer bad credit payday loans will always work within such regulations. However, the body that regulates behaviour within the financial sector in the UK, the Financial Conduct Authority (FCA), has set a limit on the maximum bad credit payday lenders can charge, both in terms of interest and any other associated costs. This type of loan will attract higher interest rates. The nature of the loan was to overcome a short term need for money, such as unexpected car repairs.Ī payday loan nowadays can typically range from £100 to £5,000 over a repayment term of up to 36 months. Traditionally, a payday loan was a very short-term loan, commonly whereby a small amount was loaned and paid off by the borrower on their next payday and is where the name of this type of loan derives from. What is a bad credit loan?īad credit payday loans give funds direct to people with a poor credit history, an increased opportunity to get approved for short-term loans. Interest charged is £60.00, annual interest rate of 292% (fixed). Representative Example: £250 borrowed for 30 days.