A Brief Guide to Bad Credit Loans.

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Bad Credit Loans up to £25,000

Whatever your circumstances

Understanding Bad Credit Loans

For all intents and purposes, ‘bad credit loans’ don’t actually exist, the term, ‘bad credit’ is bandied about a lot; the main reason being is that it is generally used to describe an individual who has a less than perfect credit score.

Loans are not broken down into descriptions such as ‘bad credit loans’ or ‘good credit loans’, an individual’s ability to obtain a loan is dependent on what’s known as a ‘credit score’ or ‘credit rating’.

Each credit reference agency will have a different method in which they rate a person’s credit score. However, that credit score will provide a lender or creditor with a specific idea of that individual’s current position when it comes to borrowing.

Brokers and lenders may market the term ‘bad credit loans’ to certain individuals who have a less than perfect credit rating. However, brokers and lenders generally offer a wide range of products which cover people of all different types of credit standing.

At one point or another, many people have found themselves in a position where their credit rating has been affected in a detrimental manner. There are a few steps you can take to try and make some headway towards improving your credit score.

There are three major credit reference agencies in the UK. They are Experian, Equifax and Callcredit, each one is obligated to provide you with a copy of your credit report.

It would be advisable to obtain a report from each of them and review them separately very carefully; there could be mistakes on there that could be affecting your credit score and can be remedied.

If you find errors, you will need to notify each of the credit reference agencies directly, informing them of where you believe mistakes have been made. The agencies will have 28 days to review the information and then decide to either remove the information or state why they believe the information they hold is correct.

Also, if in the past you accumulated a debt whilst you were out of employment, but are now back in employment, you can add a ‘notice of correction’ to your credit file, all lenders will be able to see this.

This is probably the most effective method of improving your credit rating. Always check that the payments of the credit accounts you hold are always up to date and made on time. Missing payment and making late payments may have a negative impact on your credit score.

If your payments are always made on time, it makes you look more credit worthy to potential lenders!

When a lender is looking at your credit file to get an indication of your credit worthiness, one of the checks they will make is to see if you are on the electoral register. They need to confirm you are who you say you are, they check the electoral roll to corroborate your name and address and remove any doubt of fraudulent activity.

If you are not on the electoral register, the lender may become sceptical about your identity and ultimately reluctant to release any funding.

To register yourself on the electoral roll, head over to www.yourvotematters.co.uk and complete the relevant section.

First and foremost, theoretically, ‘bad credit loans’ don’t exist, an individual’s ability to obtain credit is generally based on their credit rating.

If an individual has had credit problems in the past, any loan offered may carry a higher rate of interest, this is known as ‘rate for risk’, the higher the credit risk; a higher rate of interest may be applied to the loan.

This is probably the most common cause for concern for people with bad credit, as a broker, ‘Unsecured Loans for You’ has an extensive panel of lenders. Whilst we can’t offer any assurance that you will be accepted for a loan, plenty of lenders will consider individuals who have less than perfect credit.

Different lenders will use different credit reference agencies when looking at each application. Each credit reference agency will use their own unique systems when calculating an individual’s credit score.

For information on how Experian work, this blog post from their site explains it all in full detail: http://www.experian.co.uk/blogs/consumer-advice/what-is-good-credit-score/

Similarly, if you head over to the Equifax website, there is more information on how they operate: https://www.equifax.co.uk/Products/learning-centre/what-is-a-credit-report.html

Also, to gain more knowledge of how Callcredit use your information to calculate your credit score, check out this page form their website: http://www.callcredit.co.uk/consumer-solutions/help/how-does-the-credit-rating-scale-work

Taking out a loan isn’t going to improve your credit rating overnight; it will depend on your ability to repay the loan and that you ensure it is paid on time on the requested date each month until the loan is repaid in full.

If you manage to accomplish prompt payments, then you could see a positive impact on your overall credit score.


  • Quicker, more simple application process than a secured loan with the funds in your account quite quickly.
  • More beneficial to those looking for smaller amounts over shorter terms.
  • Unsecured Loans are extremely flexible and offer many options to best suit individual financial circumstances.
  • Usually options to repay the loan early, thus reducing overall interest charges and total amount borrowed.
  • Unsecured Loans market is very competitive and lenders are offering better deals.


  • Anyone with an adverse credit history or a history of missed repayments may struggle to obtain an Unsecured Loan.
  • Unsecured Loans not ideal if you wish to borrow a high loan amount.
  • Any missed repayments will be marked on your credit file, and may affect your ability to obtain credit in the future.
  • Not an ideal loan if you already have a lot of debt, as it may lead to increased financial pressure.

Loans up to £25,000

Whatever your circumstances

  • Loans up to £25,000
  • Loans for any purpose
  • No complicated forms
  • No 'Up-Front' fees

49.9% APR representative (unsecured)

Representative Example:
Borrowing £4,500 over 36 months. Repaying £219.55 per month. Total repayable £7,903.80. Annual interest rate is 49.9% (variable).


Likely Loans Everyday Loans TFS Loans H and T Bamboo Finance UK Credit Amigo Loans Trust Two Progressive Money

*Unsecured loans are available to a maximum of £25,000. Loans of up to £100,000 may
be offered by the lenders subject to affordability and secured against your property.
Typical Example for illustration purposes only: £25,000 over 10 years with 7.8% APR, Total to repay: £35,664, Monthly Repayment: £297.20.
Overall cost for comparison is 5.5% APR typical. Overall cost for comparison for unsecured loans is 22.1% APR typical.
Unsecured Loan Typical Example for illustration purposes only: Borrowing £4,500 over 36 months. Repaying £219.55 per month.
Total repayable £7,903.80. Annual interest rate is 49.9% (variable).

This article is intended to provide information only, and does not constitute financial advice or assistance, without limitation, warranties as to satisfactory quality, fitness for purpose, accuracy or skill. The information contained in this article is generic and non-specific to your own individual circumstances or anyone else.



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