If your credit score is not as high as it should be, getting a loan can be a nerve-wracking proposition. A loan of a few hundred pounds might not seem so difficult, but a large amount such as £5,000 can almost seem impossible. At many brick-and-mortar banks one must jump through many hoops before even having a chance at getting a loan with decent terms. What’s more, these institutions often refuse completely to lend to those with credit scores below a certain level. Hard credit checks performed during the loan application process can hurt your credit and make chances of successfully getting a subsequent bank loan much lower, disproportionately damaging those with low credit scores. There are online tools, however, that can allow a prospective borrower with poor credit to get what is called a bad credit loan, all without multiple hard credit checks. These may end up being the best choice for many with a low credit score.
One of the big issues when applying for a bank loan is that most lenders prefer to lend to customers who hold accounts with that bank. This means that you may be rejected by other banks, as they often have more stringent credit guidelines for those who do not have accounts with them. This also means that if your own bank offers loans with terms that are less than ideal, or if your bank rejects your loan due to your credit score, it can seem like all of your options have been exhausted.
Another big issue is that many lenders perform hard credit checks when making a decision on a loan. Multiple hard credit checks can put a serious dent in your credit, at least for the short term, leading to the unfortunate result that each application for a loan makes it increasingly harder to actually get a loan. This can be disastrous for someone with a poor credit score, as each credit check puts them closer to not being able to get a bank loan in the first place. This can almost make applying for a second loan seem financially dangerous, especially given the fact that the borrower may not have even had the chance to get a quote from the lender without the hard credit check being performed.
This does not have to be the case, however. There are a wide variety of online services that can help prospective borrowers make informed decisions about which loan is best for them without having to put their credit score at risk, even for large amounts like £5,000. NowLoan.co.uk is an example of one such loan comparison website. Tools such as this offer instant decisions, as opposed to the many days required with other institutions, and offer bad credit loans without performing hard credit checks in order to get a quote. This allows borrowers the peace of mind to browse different loans and discover the best option for them, with hard credit checks only being performed once the borrower wishes to continue with that particular lender. This exposure to a wide variety of lenders allows you to make the best decision for you without having to stay up at night worrying about your credit score and thus your financial future.