An unsecured loan is a sum of money you borrow from a financial institution to fund your big expenses. Popular as personal loans in the UK, these loans do not require you to put collateral regardless of your credit rating. It means you do not need to fear of losing a valuable asset in case you fall behind on repayments.
You will pay back the borrowed sum with interest in fixed monthly instalments over a set period. To qualify for unsecured loans, you will need the following things:
A good credit rating: A good credit score (881-960) is critical to afford unsecured loans from a direct lender or a mainstream lending institution. It is because a stellar credit rating reveals reliability for timely repayments.
Solid income: a lender will less likely be sceptical about your repaying capacity if you have a good income source.
Recent repayments: if you have another debt like credit card bills and you have been paying back money on time, a lender may be quickly convinced about your repaying capacity.
There are two sides to every coin. Likewise, unsecured personal loans have their benefits and drawbacks. You mustn't throw caution to the wind while applying for these loans. Otherwise, it may impact your credit score and financials. For example, the interest rates on an unsecured loan are much lower than on credit cards. However, defaulting or missing payments may extend the loan costs. It may prove challenging to recover the credit history. This is especially true when you take out an unsecured loan for a poor credit score.
Tap it only if you can comfortably afford the monthly payments. Analyse your liabilities, budget and loan amount to pursue before applying. You can take additional initiatives:
It is just the preparation part. Check these advantages and disadvantages to decide better:
| Pros | Cons |
|---|---|
| They are not backed by security, so there is no risk of losing your asset. | APRs are competitive, yet they are higher than those of secured personal loans. |
| They come with fixed interest rates, so you know how much money you are to pay every month. You can easily prepare a budget accordingly. | If you make a default, you will end up with a CCJ (County Court Judgment) |
| APRs are lower than other short-term loans like payday loans, bad credit loans, unemployed loans etc. | Monthly payments can be larger. |
Before you borrow money, you must analyse that the type of loan suits your financial condition and needs. For example, facilities like doorstep loans may help you get instant cash at your home/office. Similarly, unsecured loans in the UK can help you fund those expenses that you cannot pay upfront. Here are the top reasons why you will likely need these loans:
Debt consolidation
If you are struggling to pay off multiple debts on time, you can consolidate them into one outstanding loan. Take out an unsecured loan and use it to pay off all your current debts. Then, you will be left with one large loan that you will pay off in fixed monthly instalments. Unsecured debt consolidation loans can help you get rid of high-interest debts.
Gadget purchase
When household appliances conk out, your routine gets hindered very severely, and tension mounts up when you do not have savings to dip into. Whether your washer is broken down or your dryer is not up and running, unsecured loans can help you tide over.
Pet expenses
If you are fond of pets, you will naturally have to meet expenses like vet visits, grooming, and the like. If your savings have fallen short, personal loans can be an ideal solution to meet all pet-related costs.
Medical expenses
Medical bills can pop up anytime. If you do not have enough savings to pay them down outright, unsecured loans can be an ideal choice.
Business expenses
Whether you have a start-up or an established business, you may need funds for various business expenses like marketing, payroll etc. Unsecured loans will allow you to borrow a large amount of money for your business without any obligation like collateral and guarantor.
Repair or replace car accessories
You may use these loans to buy a car without pledging anything. Individuals with responsible finances may qualify. Alternatively, unsecured car loans may help you repair parts like- engines, steering, seats, etc. It may help increase your car’s resale value if you want to sell it anytime soon.
Household expenses
Whether electricity bill has gone up or you need money to buy gifts for your loved ones, unsecured loans are always your ally. Do not fight shy of applying for these loans if you need money to fund your household expenses.
Applying for an unsecured loan is easy. Since no assets or collateral are involved, you can apply for it with basic information. We generally ask for the requirements of the name, address, contact number, monthly income, expenses, and loan amount.
If you qualify, we conduct a basic credit analysis to provide unsecured loans with no credit check facility. It does not affect your credit score initially. However, for loans above £10000, we conduct a detailed soft credit analysis. It may temporarily impact the credit score, but not negatively.
After passing the initial check, you must meet the following conditions:
Analyse the amount you need
Passing the initial check helps you analyse the exact amount to borrow. The borrowing sum must be lower than the monthly income. Check whether borrowing less meets your needs. If yes, then do so. Figure in the additional fees also before borrowing.
Provide the basic documents needed
We generally require proof of the latest salary slip/ part-time income/or self-assessment to provide loans. Additionally, you must have proof of identity ready before applying. It could be a passport/driving license/ electoral roll.
Choose the repayment term
Pick a suitable repayment term for collateral-free loans. Analyse your income, liabilities, loan amount, and interest costs. You can choose to pay between 12-36 months for short-term loans respectively. Alternatively, for long-term funding like car repair loans, you may repay within 84 months.
Get the cash in the account
After submitting your approval on the terms, you get the cash. Always check the account number before the final approval. It quickens the process.
Note: Regardless of your credit history, the maximum amount you can borrow is £50,000. Quickloanslender offers unsecured loans at lower interest rates than the market.
Deciding on a secured loan and an unsecured loan is not easy at all. The former is subject to losing your asset in case of a default, and the latter is subject to higher interest rates than secured loans. It seems like you are stuck between the devil and the deep blue sea.
Now it does not need to be confusing at all because here you will get a detailed insight into it to make a better decision.
| Secured Loans | Unsecured Loans |
|---|---|
| They are subject to collateral. | You do not put security to take out these loans |
| Interest rates are lower, but there is a risk of losing asset in case of a default. | Interest rates are slightly higher, but there is nothing to worry about. |
| You can borrow a large sum of money depending on the value of the security you turn in. | You cannot borrow a large amount, yet Quickloanslender will allow you to borrow as maximum as £50,000 subject to your affordability. |
| These loans offer a longer repayment term, and hence the total cost of the loan can be a bit higher. | They relatively come with a shorter repayment term, and hence, you do not end up paying huge amount in total. |
Yes, you may get unsecured loans with bad credit from a direct lender only in the UK without a third-party confirmation. It requires you to provide proof of affordability to pay the dues on time. You must have income that helps you pay the debt without impacting other crucial expenses. If yes, you can improve your chances of getting unsecured loans with no guarantor and no collateral by:
Improve your credit history
One generally requires a good credit history for no guarantor-based loans. Individuals with a fair credit history may qualify. However, individuals seeking these loans must wait. Work on your credit report by:
Switch to a higher-income prospect
To get such loans, you need a stellar income. Individuals earning above £25000 annually may get instant approval than one earning £10000. Improve your income by seeking part-time income or switching to a better job possibility.
Have a separate bank account
Most individuals applying for these loans are students with little or no credit history. Here, having a separate bank account may help. You may get unsecured loans with bad credit scores, no guarantor, and no fees quickly. A bank account reveals transactions that help lenders analyse affordability and sincerity.
Yes, but remember that your co-applicant must have a good credit history. You may apply for an unsecured joint personal loan with a friend, spouse or business partner. Your partner must have a stable and good credit history. You and your co-applicant must afford the payments.
You will be responsible for the half payment when you take out this loan. However, you also agree to repay the whole of the debt if your co-applicant fails to keep up with repayments. We consider income and other financial aspects like credit score, previous borrowings, and financial management. It helps us decide the total amount you may qualify for.
A joint loan is ideal for individuals with poor credit history. You may get better rates by partnering with a co-applicant with good credit and finances.
Here are some tips to apply for unsecured joint loans with bad credit scores:
Analyse and pay some debts
Paying some of your debts and updating information (contact number, residential address, office address, employment history) may improve credit. This increase in credit score may help you fetch low interest rates.
Factor in early repayment fees
Paying early on a joint loan may impact both the persons involved. Analyse additional costs before applying. It will prevent your credit score from further damage. You can also avoid paying extra on the loan.
Stable income and good credit
Though you are applying for unsecured personal loans with bad credit and no guarantor, one of you must have an excellent credit history. It creates reliability on the repayment front. You may get better interest rates. This, in addition to good income, may turn in your favour. You may get better rates if one of you has a regular and good income.
You can qualify for these loans at Quickloanslender too, and we assure you that you will get them at lower interest rates than the market rate.
There are some circumstances when you may fail to qualify for an unsecured loan, but you can consider the following alternatives:
Business loans
If you need money to fund your business expenditure, you can consider taking out a small business loan. You will have to prove consistency in your revenues. Business loans are of two types: secured and unsecured.
Of course, you do not need to put security if you are borrowing a small amount. Unsecured business loans are generally aimed at start-ups. You will have to submit a plan of how you are going to survive in next two to three years.
If your lender has turned down your application due to bad credit rating, you can think of applying for bad credit loans. These are specifically aimed at poor credit borrowers. If you make repayments on time, your credit score will go up.
Guarantor loans
If you need a high sum at better interest rates with someone you can trust, guarantor loans may help. Also known as guaranteed loans, it reduces your liability towards monthly payments if you can't pay. However, getting a guarantor can be challenging for individuals with poor credit. If you need instant cash, unsecured no guarantor loans may help. It lets you finance the need without a second-person guarantee. Individuals with a good credit history and consistent income may benefit from this.
These are income-based short-term loans that you can use in emergencies. You may get unsecured payday loans by revealing your full or part-time income slip. It requires one to clear dues the day after “payday” or salary day. You may get up to £1500 for your instant requirements.
Financial needs and desires come in different forms and lengths. If one person has a small financial need, then another may have a longer financial purpose to achieve. Our company wants to contribute to both scenarios. Therefore, we offer more than only short-term unsecured loans to individuals.
Other direct lenders in the UK usually offer small unsecured loans to the applicants. They may worry about the risks involved in lending a substantial amount. On the other hand, we are ready to take that risk and offer long-term unsecured loan as well.
You can use these loans for more significant purchases like home buying, mortgages, new car purchases, etc. You can utilise such long term loans to fill the funding gap that occurred during those extensive expenses.
With us, you will get the following features on these loans with an unsecured nature.
| Features | Short-Term Unsecured Loans | Long-Term Unsecured Loans |
|---|---|---|
| Loan Amount | Borrow up to £10000 | Borrow Up to £50000 |
| Loan Term | 12 - 36 Months | 36 - 84 Months |
| Loan Repayment Modes | Weekly or Monthly | Monthly |
| Ideal Loan Purposes | Financial emergencies or small expenses | Larger financial goals or purchases |
| Guarantor | Not Required | Required |
| Income Status | Full-time or Part-time Monthly Income | Full-Time Income |
| Credit Score | Loans for Any Credit Score | Good Credit is preferred, but Bad credit people can also apply |
When you are running a small business or have just located a start-up business, you may require external funding support at some point in time. You may need one to release payrolls, improve working capital infrastructure, buy equipment, etc. Here, facilities like an unsecured business loan may help. These can help you take out a large amount of money for your business without putting in security. However, you may not get the large amount after placing the collateral. It comes with a mental peace of not losing or staking your precious assets.
Qualifying for long-term business unsecured loans over 10 years requires a stable credit history and finances. Here are some other ways:
Analyse your current revenue and expenses
One must analyse the yearly income and monthly expenses before seeking business loans. It is a long-term agreement. Therefore, businesses with consistent cash flow find it easier to qualify. Think from the future perspective by analysing your previous 3 months' earnings. If you have projects and are signing some, consider it.
Check whether you need a personal guarantee
A Personal Guarantee is a document that grants the asset ownership to a lender if the business can't repay. We do not ask unless necessary but may ask if your finances do not meet the loan requirements. Getting unsecured bad credit loans for business is generally a primary condition.
Update your business plan
Your business plan may help you fetch better interest rates. It is ideal for businesses seeking loans with poor credit. For approval, identify the aspects like executive summary, expected revenue, key parameters leading to success, and competitive analysis.
We may ask you to provide details about your purpose for using the loan. If you go through that, you can get the loan.
QuickLoansLender has become one of the most preferred to get unsecured loans from direct lenders for the last few years. The primary reason is that we always focus on reviving the whole financial status of our applicants. Providing loans only is not our motive; instead, we give you complete financial support.
It is why we have been able to serve the financial purposes of many people.
Here is why our customers like our services:
Do you want to test our financial assistance? You are welcome to do so. Apply for unsecured loans once, and you will surely receive what you have expected from us.
