How to Get a Payday Loan with Bad Credit

Can you get a payday loan if you have bad credit?

Do payday loans affect your credit score?

These are just some of questions we find ourselves asking when it comes to applying for any kind of short-term loan.

If you do suffer from poor or bad credit but find yourself short on funds at the end of every month, then be rest assured you are not alone. 43% of Brits find themselves struggling at the end of each month, looking for ways to supplement their wages and thus, turn to the Internet and search for “Payday loans bad credit”.

Before you apply for any type of loan, whether it’s a short-term loan, no credit check loan or an unsecured loan, always ask yourself this:

“Can I afford to repay my loan in full and according to the payment schedule?”

If you can honestly answer yes, then this guide is for you as we attempt to cover everything you need to know about payday loans and those with poor credit.

What is bad credit?

Bad credit is a phrase used to describe those with a history of poor financial circumstances or have suffered when managing their finances. Those who have a poor credit historically have missed credit obligations like a utility bill, credit card or not repaying a loan on time.

Bad credit then, is an indication that one borrower is likely to be riskier to lend to than another.

Those who have a low credit rating then find it extremely difficult to find credit to manage their lives. Examples of this could be:

  • Continually repaying loans late
  • Failure to repay a loan in full
  • Bankruptcy or Individual Voluntary Arrangement (IVA)
  • Had you home or car repossessed
  • Debt passed to collection agencies

Not sure what your credit score?

Visit Noddle.co.uk to find out.

There is another group of borrowers who are also affected by poor credit history – those who have never borrowed in their lives. Having no credit score is just as bad as having a negative credit history as lenders have no idea about your ability to repay credit.

What is a payday loan for bad credit?

A payday loan for those with an adverse credit rating is a last minute, short-term loan to support customers when life’s little financial emergencies occur.

These types of loans are designed to meet urgent cash needs when those with poor credit need help the most.

As with all loans, it’s essential that if you borrow money, that you can repay the loan within your budget and adhere to your schedule.

Bad credit payday loans are no different from your typical everyday payday loan – there is no difference in APR and fees because you have a low credit history. So, you can be rest assured that unlike banks, who will penalise you with higher interest rates, payday loans are the same rate, whether you have a negative credit history or not.

Do payday loans impact credit scores?

According to Experian, a leading UK credit scoring agency, payday loans do not impact your credit score if you repay them in full and to the agreed payment terms.

Another point to note is that you do not have a single credit score, as each credit scoring agency has their own criteria for assessing your score, that will impact you when applying for credit.

How to apply for a payday loan if you have bad credit?

Like any other credit application, applying for a payday loan is no different. Each lender will use a different credit agency to aid them in correctly assessing your application.

As per the point above, those with a low credit rating could be accepted dependent on which credit reference agency the lender chooses to use.

Before you apply for a payday loan, it is probably a good idea to check your credit score with several credit reference agencies first to determine whether you are likely to be accepted or not.

Once you have this information at hand you can pick and choose lenders who use specific credit reference agencies that have given you a more favourable score, increasing your chances of being approved for a payday loan.

What are the advantages of bad credit payday loans?

Bad credit payday loans are available when the traditional forms of credit are not open to those with little or no credit, like bank loans or overdrafts. Poor credit loans are invaluable when you need a small, short-term loan to meet car loan repayments or fix a boiler, or any financial emergency.

Peachy’s application process is straightforward and non-intrusive, we only require the following to assess your application:

  • Personal details
  • Contact details
  • Employment details
  • Financial details

Bad credit loans are unsecured loans, meaning that they are not secured against your car or house, reducing the risk of losing these assets should you not repay. Failure to repay on time will further impact your financial credit history.

Unlike personal bank loans with repayments required for months and years, a payday loan is short-term only. There are no long-term repayment obligations, permitting you to get your life back on track.

Why consider Peachy for a payday loan for bad credit?

At Peachy we have a dedicated team of specialists who assess and approve short-term credit for those with a low credit rating.

Applying for a loan with Peachy is entirely free of charge. Using our loan calculator, you can view exactly how much it will cost you and the multiple repayment options open to you.

When you apply online for a payday loan with Peachy, it means our specialist team will instantly view your application. As a borrower, this means a higher chance of your loan application being approved.

It is vital to note that not everybody who applies for a payday loan for bad credit loan will be accepted. As a responsible lender, Peachy will assess each application individually and sympathetically.

As with any loan, responsible borrowing is essential. You must be able to repay your loan commitments in full and on time. Not doing so will help you build up a cycle of debt, making your financial circumstances even worse.