How To Decide On The Right Poor Credit Loan in 5 Easy Steps
It is still almost too easy to borrow money these days – many loans are available online and getting a loan could be a simple as pressing a button!
It is therefore very easy to make a mistake and take out the wrong loan which could turn out to be an expensive mistake!
So to make sure you do not do this, have a look at our 5 easy steps on how you can make sure that you do take out the right loan for you:
Step 1 – Ask yourself the question “do I need to take out a loan at all?”
It has become all too common in today’s society to borrow; mainly because it’s now really easy to borrow money compared to 50 years ago.
The problem is though that borrowing money does costs you money, money that could be being spent on 101 other things.
So before you look at what loan is right, first really challenge yourself whether you actually do need to borrow any money at all:
- “can I wait till next month when a loan would not be necessary?”
- “do I really need to replace / buy this?”
- “could I get some overtime at work which would maybe help me pay for this?”
If you’re still not sure, check out these ‘5 Questions to Ask Yourself Before Taking Out a Loan‘
Step 2 – Ask yourself “what is the minimum I can get away with borrowing?”
Simply, the less you borrow, the less you are going got have to pay back and the more money you have to spend on the nicer things in life.
So maybe there was not the option of not getting the loan at all, but hopefully, you have now thought of a few ways that could mean minimising the amount of money you do need to borrow.
Please click here for a different take on the borrowing process and the key questions that you need to ask yourself.
Step 3 – Work out your income & expenses and how much you can comfortably afford to pay off per month
One big mistake a lot of people make is overestimating the amount they can afford to pay per month; for it’s easy to forget about the many unplanned expenses that turn up month by month, plus other things like Christmas and holidays.
So list down your income, and then all expenses that are likely to come up every month; and everything that you are going to need to budget for.
Then this should give you a much better idea as to the amount you can comfortably afford to spend per month on your loan repayments.
Work out your budget by following these guidelines – Work out your budget
Step 4 – Research all the different options for borrowing money
There are a lot of potential ways that you can get money even if you do have a poor credit rating; then main ones being:
- Bad credit personal loans
- Credit cards
- Pawn Shops (Cash Converters etc.)
- Borrow money from friends of the family
- Payday loans
- Doorstep loans
- Bank loans
If you have done your research and are aware of the different options then you are more likely to then make sure you get the right loan.
We specialise in a type of personal loan that requires a friend or family member to guarantee the loan for you. These are better valued lower cost poor credit loans, but you do need a friend or family member with a good credit history to support your application.
Learn more about the different types of loan available by clicking here.
Step 5 – Submit your applications
It’s always important to ensure you fully understand the options you have available to you. However, making too many loan applications can have a detrimental effect on your credit rating.
How many applications you make is up to you; we would not recommend too many.
For more on this, check out – How many credit applications is too many?
If you would like to consider a quick loan, then our one simple form will send your application to all the top poor credit loan Lenders in the UK.
For further insight into these low risk, bad credit loans, visit our FAQ section.
So you get access to the whole market quickly and easily. You will then start getting loan offers directly via email within minutes of submitting your application.
Recommended Further Reading