Those with bad credit may struggle to qualify for loans. Lenders who receive an application for credit from a potential borrower are going to consider your credit score and/or history. Often those with bad credit find themselves with very limited options. Typically they will qualify only for loans with high rates of interest, which makes it more expensive for the borrower. Sometimes an individual with less-than-perfect credit simply needs a short-term loan for an unexpected expense. In these situations you may want to consider applying for a short-term loan from an online lender. Response Funding Limited is a potential source for personal unsecured loans. Even those with poor credit may qualify for a loan and receive the funds on the same business day.

What is Considered Bad Credit?

The credit reporting agencies use your credit history to calculate a credit score. This score is a critical number that largely determines your eligibility for a loan with lower rates of interest or not. Some lenders may only be willing to offer you loans with high rates such as credit cards that have a 20% APR. What is considered to be a good or bad credit score? Experian is among the largest credit agencies. They use a scale from 0 to 999 with roughly five categories as follows:

Credit Score Classifications[1]Range
Very Poor0-560
Poor561-720
Fair721-880
Good881-960
Excellent961-999

Checking Your Credit File

The three main credit reference agencies in the U.K. are Experian (Credit Expert), Equifax and Callcredit–now known as TransUnion. These agencies are independent from one another and the details within your report may differ among them. Look for any potential errors that you see on the report. It is possible that a negative entry has mistakenly been added to your file. Studies show that roughly 20% of those who review their reports find some type of error. You will want to contact the agency when you notice an error. The agency then has a period of 28 days to respond to your request. Checking your file also may reveal if you have been the victim of identity fraud. Criminals have been obtaining the identities of consumers without their knowledge and obtaining credit in their name.

Obtaining a Loan Without a Credit History

How do lenders respond when you have no prior credit history? Lenders tend to view an applicant with no credit history as risky. This is because no pattern of prior credit usage is available to help in making a decision. Lenders prefer to see a history that shows the responsible usage of credit. Beginning to establish a credit history is important and may take some time. There are “credit builder” types of credit cards that generally have low credit limits, high interest rates and some varying fees.

Ways to Improve Your Credit

The best method for improving your credit report is to responsibly manage your finances and look for opportunities to demonstrate creditworthiness. Some smaller credit accounts such as mobile device accounts or store credit cards may be easier to qualify for. Some credit cards have high interest rates, yet can be used and promptly paid back to avoid incurring significant interest charges. Avoid applying for credit too frequently, as this can have an adverse effect on your credit history.

Traditional Lenders

National and community banks are generally considered to be “traditional” lenders. These are usually those with the most stringent lending requirements. For example, Wells Fargo’s unsecured personal loans generally require a minimum of a 660 credit score. Credit unions are another source of loans. These are community providers of savings and loans that are made up of members. Credit unions may offer loans with less stringent credit requirements. Many of these lenders may require that you visit a local branch office for the application process. They then may take several days (or weeks) to make a decision.

Other Alternatives

Some lenders may require that a borrower with poor credit have a guarantor. This is an individual with a good credit history that “guarantees” the loan if the balance is not paid back. A guarantor is typically a friend or relative that is willing to help the borrower. Another option is obtaining a loan by using personal property, such as jewellery through a pawnbroker. Some online lenders are also willing to offer short-term personal loans to those with a limited or fair credit history.

Short-Term Personal Loans

A personal loan provides the borrower a fixed amount of money that is paid back over a specific period of time. The interest charges are likely higher than a traditional bank loan. A short-term personal loan is potentially a good solution for unexpected expenses that arise such as car repairs. They are often referred to as payday loans because they are paid back in installments according to when you are paid. Many borrowers find that the interest charges are reasonable and they appreciate the ability to obtain needed funds quickly.

Benefits of Personal Loans from Response Funding

There are many situations where a short-term loan from Response Funding may be a good solution because the many benefits:

  • The applications process may be completed quickly and easily using your computer, tablet, smartphone, or other device
  • Those with less-than-perfect credit may still qualify to borrow money
  • We are a U.K.-based direct lender that is properly licensed and registered with the FCA
  • As a direct lender, the borrower can avoid added “middleman” or broker fees that may be found at other financial institutions
  • The loan approval process is completed very quickly and you may receive the funds in as little as one-day
  • Repaying the loan is quite simple since the payments are made according to your payday
  • We use the latest in real-time server and platform security technology to be sure that your personal data is protected
  • All interest charges and loan terms are clearly explained without wording in small print that contain unexpected fees
  • Loans have a 0.8% daily rate of interest, an APR of 1304.41 and a fixed annual rate of 292%

What are the Requirements for a Same-Day Loan from Response Funding?

You must be an adult resident of the U.K. Applicants must have current employment that can be verified. A current bank account is needed that can be used for electronic transactions. The maximum amount that may be borrowed on your initial loan is £125. Future loan amounts may be increased at the discretion of the underwriting staff. We adhere to responsible lending practices. It is important that our online loans are appropriate for borrowers based on their individual financial circumstances. Our loan products feature short-terms that do not exceed a period of three-months. These loans are not available in longer terms and are not suitable for those currently unemployed.

Personal Loans for People With Bad Credit

Are you faced with a sudden expense that needs to be paid quickly? Response Funding Limited is a source for short-term personal loans. You can apply for a quick loan 24-hours-day and our staff will make a lending decision promptly. Those with past credit problems may still qualify and receive fast cash today. Our loans are paid back in installments over a three-month period designed to allow you to maintain other financial commitments. You are not required to have a guarantor or collateral to potentially be approved for the funds you need. We encourage you to apply easily using our secure online application today!