1. Home
  2. Loans
  3. Loans for bad credit

Loans for bad credit

Compare bad credit loans

  • Comparing loans won’t affect your credit score

  • Compare quotes from a wide range of trusted providers

  • Apply today and borrow between £1,000 and £50,000

We've partnered with Monevo to offer their best deals on loans. Monevo is a credit broker not a lender.

What is bad credit?

Bad credit usually means a history of missed payments on credit agreements. You might have bad credit because you owe money or have a record of not paying bills back on time, for example.

When you apply for finance, like a loan or a new mobile phone contract, companies will look at your credit status to work out whether you’re likely to make repayments on time in the future.

There are many reasons why you might have a low credit score, including:

  • Bankruptcy
  • Defaults on payments
  • County Court Judgements
  • An individual voluntary arrangement (IVA), debt management plan (DMP) or a debt relief order (DRO)
  • Too many ‘hard’ credit searches on your credit profile – When you apply for a loan, finance or credit card and the lender looks into your credit history

You might also have bad credit because you haven’t had the time or opportunity to build up a credit history.

If you have bad credit, you’ll find it hard to borrow from lenders, get a credit card or apply for a mortgage. Lenders will think you’re ‘high risk’ as the chances of them getting repayments back will be low.

Compare loans for bad credit

How can I get a bad credit loan?

If you have a poor credit rating, or simply no credit rating at all, it can be difficult to get a loan approved. But there are some options available to you, like a bad credit loan or a loan for debt consolidation.

Some lenders offer personal loans to people with bad credit. But at higher interest rates and with poorer lending options.

Although your options may be limited, we compare a range of providers who offer loans for those with a bad credit history. We’ll also show you the likelihood of acceptance without affecting your credit score.

What are the pros and cons of taking out a bad credit loan?

It's important to weigh up all your options before taking out a loan.

The pros of bad credit loans include:

  • Quick access to money as some lenders can transfer funds to your account quickly.
  • It may improve your credit score as keeping up-to-date with your repayments can positively affect your credit report. This will help if you want to apply for more credit in the future as you should see better interest rates.


The cons of bad credit loans include:

  • Committing to monthly repayments as you’ll pay back the amount you borrowed in monthly instalments. If you miss these repayments, you can risk damaging your credit score further.
  • High interest rates are expected if you’ve got bad credit. The overall amount you pay back on a loan will cost you more.
  • Extra fees – always check the terms and conditions for any penalties like late repayment fees and returned payment fees.

What should I consider before applying for a bad credit loan?

Everybody's financial situation is different. So it's important to think through a few things before you apply for a loan, including:

  • How much you can afford to pay back each month
  • How much you need to borrow
  • what your credit score is like
  • How much interest you’ll pay back

Sometimes, the more you borrow, the lower the interest. Be careful not to borrow more than you can afford to pay back.

The repayment term also affects the interest rate. A longer loan term may mean lower monthly repayments. But the interest rates and total repayment cost could be higher.

What do I need to apply for a bad credit loan?

Before you start to look for a suitable loan, there are a few things you'll need before applying:

  • Your current U.K. address
  • An email address and contact number
  • Your annual income
  • Your general outgoings

Compare loans for bad credit

Why have I been refused credit in the past?

You may have been refused credit due to:

  • A poor credit rating
  • Having too many loans
  • Your employment history
  • Low income/irregular payments
  • Your credit history
  • Assets for a secured loan

A poor credit rating suggests you may be going through financial difficulties. This may not be your fault, but it suggests to the lender that you might struggle to pay back the loan. This can lead to your loan application being rejected, which can further harm your credit score.

Having too many loans when applying for another shows the lender that you’re financially unstable. This can suggest that you’d be unable to pay back the loan.

Your employment history. If you’ve been in and out of work or have changed jobs frequently, lenders might think this shows you’re in financial difficulties.

Low income/irregular payments can impact your eligibility for a loan.

Your credit history if you’re from another country or you’re too young and haven’t had time to build up a credit score. Unfortunately, this can count against you.

Not enough assets for a secured loan. If you apply for a secured loan, but you aren’t able to offer enough collateral, such as your house or car as security, a lender might reject your application. In this case, an alternative to a bad credit loan could be an unsecured loan.

How do I manage my loan repayment?

Once you have taken out your loan, it’s important to know how to manage it. It’s your responsibility to make sure you make the repayments on time, every month until it’s paid off.

When you take out a loan, you’ll agree with the lender on how long the repayment period will last. This will usually be 1 to 5 years. You’ll get the loan amount in one lump sum and you’ll normally have to repay it bit by bit every month until you’ve paid it off.

The final amount you pay back won’t just be the amount that you borrowed from the lender. The full amount you repay will usually include some interest and depend on a number of things, including:

  • How much you’re borrowing
  • How long you’ve agreed to pay the loan back for
  • The interest rate
  • Whether the loan is a fixed or variable rate

Make sure you know what the repayment date is each month. If you have bad credit, missing payments could mean you have to pay additional charges. It could also put more negative marks on your credit report.

Loan repayments will be taken from your account each month. The most common ways to pay are:

  • Direct debit, which is set up by the lender using your account number and sort code. It’s usually a fixed agreement and should only be changed on the agreed date by the lending company.
  • Continuous payment authority (CPA) or recurring payments, meaning the lender can take the money that you owe them at their discretion.
  • A standing order, which is set up by you. You pay a fixed amount to the lender out of your account at agreed intervals, e.g. once a month. You can change or cancel a standing order at any time.

Of the three, a direct debit may be the best option as it puts the lender in control to take the payment regularly. Make sure you have enough money in your account each month to make the monthly payments.

With a direct debit in place, you’re more likely to make the payments, so you’ll avoid any black marks on your credit report. Need some more help working out how to manage your loan repayments? Take a look at our loans calculator.

Will comparing loans affect my credit score?

Being refused a loan can have a harmful effect on your credit report. This is because when you apply, loan companies will carry out a hard credit search to get a complete view of your credit history.

The search will show them if you're a good lender and have the credit history to back up the repayment. But there are other ways to get credit that don’t involve having a loan refusal mark your record.

Comparing a range of loans through Confused.com means you can view all the available options. Simply type in a few details and we’ll carry out a soft search.

A soft search won’t impact your credit score. We’ll only do a hard search when you choose a provider and have an idea of if you'll be accepted for the loan or not.

This is a smart way to avoid having lots of loan refusal applications on your report, which could damage your credit score even more.

What is a credit report?

Credit reports are produced by agencies like Equifax or Experian. They gather information about your credit history, like previous loans you’ve had or credit applications you’ve made.

This report can then be viewed by a financial company so they can get an idea of your financial history and behaviour. It’ll show whether you’re a reliable candidate to loan to and how likely you are to repay the loan back on time.

Have a good financial history? Then you’re more likely to be approved! If you have an unreliable history with credit repayments, you may find it hard to borrow or be offered higher interest rates.

Luckily, together with our loans partner Monevo, we’re able to bring you a wide range of lenders to offer you our best loans deals.

Improving your credit score can benefit your credit report.

What’s the difference between a soft credit check and a hard credit check?

A soft credit check happens when a broker or lender takes an initial look (check) of your credit report without examining it fully.

These types of checks on your credit report are only visible to you, so they’re not marked against you in your credit history. You can run as many soft credit checks on your report as you like, as companies can’t view them.

A hard credit check happens when a company needs a full check of your credit history. These searches are recorded on your report for you and companies to see. By looking at the hard credit checks on your report, companies will be able to see how many times you’ve applied for credit in the past.

Comparing bad credit loans with us and Monevo will only ever leave a soft credit check on your report. But a hard credit check will be needed to successfully apply for a loan.

This will happen once you choose a loan from our list of providers and click to visit their site.

Why use Confused.com and Monevo for loans for bad credit?

We’ve teamed up with the personal loans experts Monevo to offer the best possible deals on loans. Monevo's service offers:

  • A free service with no obligation to apply once you’ve got your rate
  • Eligibility checks with no impact on your credit score - lending partners run a soft search on your credit file which doesn’t affect your score

Think carefully about securing debts against your home. Your home may be repossessed if you don’t keep up repayments on a mortgage or any other debt secured on it.

If you’re thinking of consolidating existing borrowing, know that you may be extending the terms of the debt and increasing the total amount you repay.

Expert guides

See all loans guides
Confused.com’s loan solution is offered by Monevo Limited. Monevo Limited (Monevo) acts as a credit broker not a lender. Monevo Limited (Monevo) is an Appointed Representative of Quint Group Limited (Quint), and is entered on the Financial Services Register under reference number: 723672. Quint is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register under reference number: 669450. Monevo is registered in England and Wales (Company number 06511345). Registered office: Glasshouse, Alderley Park, Nether Alderley, Cheshire, SK10 4ZE. Licensed by the Information Commissioners Office, (Registration number Z1498441).