How do you get guaranteed loans with a poor credit history?

Ailsa Adam March 14, 2024

When facing financial difficulty, it is natural to think whether there exist any guaranteed loans. While guaranteed loans may sound appealing, one must understand what you get under them.

In reality, guaranteed loans imply you get the loan only if you share the affordability to get one. The loan providers analyse the borrower’s ability to repay the loan. They review credit history, finances, income and other factors. It is the reason individuals with poor credit history struggle to qualify.  But at the same time, guaranteed loans provide an opportunity for individuals with low credit profiles to qualify.

If an individual can provide clear proof of loan affordability by revealing regular income proof, he may get approval. Additionally, other financial aspects may help him secure low-interest rates. The blog discusses the best aspects you must nail to get a guaranteed loan with a bad credit score.

What do guaranteed loans imply?

A guaranteed loan is an unsecured personal loan available to counter short-term emergencies and unexpected costs. It helps the individuals with poor credit histories get a quick loan approval. This is because the primary criteria to qualify it is income. However, meets the lender’s eligibility and income approval criteria. 

The word “guaranteed” implies that you can get the loan only if you can repay it comfortably.  Thus, if you can make regular instalments on the loan, you may get the loan instantly. The amount one gets here is around £5000 for your needs.

Does the pre-approval process guarantee the loan approval?

Pre-approval is a common term used in the lending industry. However, it does not guarantee the loan approval. It is the initial process that reviews your potential to qualify for the loan. Lenders conduct it and provide their assessment based on the information you provide.

You must provide basic information like- your income, credit history, employment history, the amount you need, and your contact number. They align the information with criteria and check whether you meet them.

 After analysing, the lenders provide you with an indication or likelihood of being approved for a loan. However, the final approval rests on detailed credit checks and other details you provide.

5 Ways to get guaranteed loan approval with a poor credit history

While there are several ways to improve your situation to get a loan with bad credit, here are some of the most important ones. Getting a loan for bad credit is tricky for the most obvious reasons like- an unreliable profile. However, do not lose hope. Here are some ways to improve your chances to get a guaranteed loan for low credit:

1)     Understand your credit profile

It is one of the most important parts of getting a loan. Familiarise yourself with your credit report and its subjects. Understand how a particular debt impacts your credit score. It will help you take immediate action accordingly.

Additionally, analyse any discrepancies or reported errors that mark your credit history still. Remove them by contacting the credit agencies. It will help you boost your credit score and qualify for guaranteed loans for bad credit scores at affordable interest rates. However, approval is not the end of the agreement. You must share the complete responsibilities to repay the loan timely.

2)     Improve your income possibilities

Income is the most important factor in guaranteed loans. However, individuals with part-time income or living on benefits may struggle to qualify instantly. This is because the loan providers desire regular and reliable income proof as a means of loan affordability. In the absence of income verification, the lenders reject the loan application.  

It is thus important to prove the authenticity of your employment and history. For this, you must hold a relevant income. If you work as a part-timer, check whether you can get more from relevant and authentic platforms.

Alternatively, individuals with income below £12000/month may struggle to get a loan. Individuals may not get over £4000 for their needs. This is because the providers eliminate the bills and liabilities before calculating the repayment ability.

With low-income individuals, getting £5000 for needs is challenging. Thus, try to re-calculate things and get £4000 loans for a bad credit score instantly. Check whether you need it at all. If your savings do not suffice your needs, you can check one.

3)     Explore and research the best loan providers

Researching is one of the most critical parts of getting affordable interest loans. Thus, understand your money requirements, credit history and finances and search accordingly. You can spot multiple comparison websites that list interest rates, APR and other measures to compare.

However, it may not be the exact the lenders may charge, but it gives you an idea of the lenders you may qualify for. The final costs of the loan may change according to the lender. Charges and other aspects differ from lender to lender. Thus, research the best one according to your needs. Additionally, confirm the extra costs lenders may not tell you about openly. These are known as hidden costs. It may make the loan costly.

4)     Submit an accurate application

When completing an eligibility analysis, you may be required to fill out a small form. It just asks for basic details like email, contact number, full name and the amount you need as a loan. You must read or skim through the details before applying for the loan.

A minor mistake on the form may lead to application and loan rejection.  Thus, identify your needs and keep the income proof and personal ID as documentation proof ready. It is because if you qualify, the lender proceeds to the next step that’s income and ID verification.

5)     Check whether you are connected to a bad credit person

Having financial associations with individuals with poor credit history may also impact your chances to qualify. It is because combined or joint loans and accounts with a bad credit person impact your credit history, too. It thus impacts the chances of qualifying. If you have any accounts like unused bank accounts, credit cards, or a joint account that you use no more, disconnect from them.

Bottom line

Guaranteed loans are the best way to counter any emergency without worries. Individuals with disciplined finances and regular income can get it immediately. However, if pre-qualification does not give you satisfactory results, step towards improving your chances. You can do so by improving your credit history, having clear employment information, improving employment progress and income, etc. It will help you get through the loan approval.

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