Loans for bad credit
Are you looking for a bad credit loan? Drafty could help. We consider every application, including if you have a bad credit score or poor credit history. Apply for a loan between £1,000 and £3,000 today. If approved, we will send the money to your bank in 90 seconds. It may take longer to reach your account, depending on your bank’s processes.
Representative 79.9%APR
Representative Example: Given a Representative APR of 79.9%, if you borrow £1000 over 18 months at 59.9% p.a. (fixed), you would owe 18 equal repayments of £85.56. You will repay £1,540.08 in total.
Not all applications will be approved for credit. An offer of credit is subject to status and affordability checks.
Why choose Drafty for bad credit loans?
Fast
Cash sent to your bank in under 90 seconds, if approved. It may take longer to reach your account depending on your bank’s processes.
Varied repayment periods
Repay in 12, 18 or 24 months.
Convenient
Secure online application available 24/7. An instant decision.
Need a loan but struggling with a bad credit score?
A bad credit score doesn’t mean you can’t access the money you might need. Drafty is a UK FCA authorised direct lender. We assess your overall financial situation and not just your credit score. Unlike traditional lenders, we offer loans for poor credit scores or very bad credit. Our process is simple, transparent, and designed for people struggling with unexpected expenses. Don’t let your credit history hold you back, Drafty is here to help.
What are bad credit loans?
Bad credit loans are designed specifically for individuals with poor credit history. These loans can help those who struggle to access traditional loans. This could be due to previous financial challenges, such as missed loan repayments, late payments, or defaults. Traditional banks and credit unions often decline loan applications from those with bad credit scores.
A credit score is a key factor that lenders consider when assessing loan applications. There are three main credit reference agencies in the UK. They evaluate your credit on a scale ranging from excellent to very poor.
We’ve included a chart below to help you better understand how your credit score is categorised.
| Credit Score Range | Very Poor/Poor | Fair | Good/Very Good | Excellent |
|---|---|---|---|---|
| Experian | 0-720 | 721-880 | 881-960 | 961-999 |
| Equifax | 0-438 | 439-530 | 531-810 | 811-1,000 |
| TransUnion | 0-565 | 566-603 | 604-627 | 628-710 |
Eligibility criteria for loans for bad credit
Eligibility requirements can vary between lenders. However, if you are looking to apply for a bad credit loan with Drafty, you need to meet the following:
- Age: You must be at least 18 years old.
- Residency: You must be a UK resident.
- Income: Be in regular employment with a net monthly income (after tax) of at least £1,000.Bank account: A valid UK bank account and debit card is required.
Once you apply, we’ll run credit and affordability checks. We do this to make sure that you can afford the monthly repayments.
Representative 79.9%APR
How to apply for a bad credit loan online with Drafty
Once you have checked our eligibility criteria, you can apply:
Apply
Click on the apply now button and complete our online application process. Choose how much you want to borrow. Then, fill in your personal, employment and banking details. It usually takes 15 minutes or so, but application completion time may vary.
Checks & approval
Once we receive your application, we’ll run affordability and credit checks. We do this to see if you can afford the repayments on top of your existing financial responsibilities. In most cases, we’ll give you an instant decision.
Get your money
If approved, we will send the money to your bank in 90 seconds. It may take longer to reach your account, depending on your bank’s processes.
What amount can I borrow with poor credit?
The amount you can borrow depends on the lender and your financial
situation. Most lenders offer bad credit loans ranging from small amounts for emergencies to larger sums for planned expenses. Factors like your credit score, income, and ability to make monthly repayments play a role.
At Drafty, we offer loans between£1000 and £3000 for individuals with poor credit scores. Our process is simple, and we focus on affordability instead of just your credit report.
If you have bad credit, it is likely that your loan offer will be lower than for
those with a good credit score. Additionally, in some cases the overall cost of the loan, including interest, maybe higher. It’s important to check whether you can afford the repayments before borrowing.
How do the loan repayments work on Drafty?
Repayments with Drafty are simple. You can log into your online account to check your payment status and history. Payments can be made through a Continuous Payment Authority (CPA). Or alternatively, we also accept payments from debit cards, google pay, apple pay and bank transfer.
To pay online, choose the amount, select a payment method, and complete the transaction. Bank transfers require using your Drafty account number as a reference. You can repay early to save on interest without any fees.
Late payments incur a £12 fee and may affect your credit score, so it’s best to contact us if you’re facing difficulties.
What types of loans are available for people with poor credit?
Personal loans
A personal loan can be used for various purposes. This includes managing unexpected expenses or funding significant purchases. Typically unsecured, these loans don’t require any assets. Repayments are made in fixed monthly instalments over n agreed number of months.
Unsecured loans
Unsecured personal loans don’t require you to have assets. This makes them one option for people with bad credit. Though, if you have a poor credit score these loans can have lower borrowing limits and higher interest rates. Eligibility is based primarily on your creditworthiness and ability to repay.
Secured loans
A secured loan requires using an asset, such as your home or car, as collateral. This reduces the lender’s risk, allowing you to borrow a large amount or get a lower interest rate. However, failing to repay could result in the loss of your possessions. The lender will have the right to reclaim the money you owe them by selling the asset you used to secure your loan.
Guarantor loans
A guarantor loan involves a third party. This could be a trusted friend or family member who agrees to cover repayments if you fail to make them. These loans can offer better terms, such as lower interest rates, as the guarantor reduces the lender’s risk. Guarantor loans might be a good option for borrowers with a poor credit rating.
Alternatives to bad credit loans
If you’re struggling to get a loan, it might be time to consider other options.
Here are some alternatives to poor credit loans for you to consider:
Payday loans
A payday loan is a short term loan designed to be repaid on your next payday. However, payday loans come with high interest rates and fees. This can lead to a cycle of debt if not managed properly and repaid on time.
Credit cards for bad credit
Credit cards for bad credit offer a way to borrow money more flexibly than traditional loans. These cards often come with higher interest rates and lower credit limits. While they can help rebuild your credit if used responsibly, they can also lead to more debt if not carefully managed.
Borrowing from family and friends
Borrowing from family and friends can be a good alternative to formal loans, especially for smaller amounts. The terms may be more flexible, and interest rates can be much lower or negligible. However, this option can strain personal relationships if repayment becomes difficult.
How can I improve my credit score?
Eligibility requirements can vary between lenders. However, if you are looking to apply for a bad credit loan with Drafty, you need to meet the following:
- Make timely payments: Consistently pay your bills on time, including credit cards, loans, and utility bills.
- Reduce outstanding debt: Pay down existing debt, particularly high-interest credit card balances. Aim to keep your credit card balances well below their credit limits.
- Avoid opening too many accounts: Limit the number of new credit accounts you open. Too many inquiries or new accounts in a short period of time can negatively impact your credit score. This can lower your chance to obtain credit in future.
- Keep old accounts open: The length of your credit history is a factor in your credit score. Avoid closing old credit card accounts, as they contribute to the length of your credit history.
- Seek professional support: If your credit situation is challenging, consider consulting a financial advisor for guidance on improving your credit.
- Check your credit report for errors: You should regularly check your credit report to see if it is accurate and up to date. Any mistakes can negatively impact your credit score.
Remember that improving your credit file takes time, and there is no quick fix.
FAQs – Loans for bad credit
Is Drafty a bad credit loans direct lender?
Yes, Drafty is a bad credit loans direct lender in the UK. We offer loans from £1,000 to £3,000. If approved, we’ll send the cash to your bank in 90 seconds*.
How do bad credit loans work?
Bad credit loans work similarly to other loans. You can apply online, providing personal details, proof of income, and information about existing debts. Regulated lenders will assess your affordability to make sure you can afford the repayments. These loans can have higher interest rates and less favourable terms due to the increased risk for the lender.
Does Drafty offer loans to people with no credit history?
Yes, we consider applications from individuals with no credit history. At Drafty, we focus on your current financial circumstances and ability to make monthly repayments. Not just on your low credit score.
What is the easiest loan to get with bad credit?
The easiest loan to get with bad credit is usually an unsecured loan, a guarantor loan, or a payday loan. Though it may be easier to get, they often carry higher costs and risks. It’s crucial to consider your ability to repay before committing. At Drafty, we consider people with bad credit for our loans.
Will a bad credit loan affect your credit score?
Yes, a bad credit loan can affect your credit score, both positively and negatively, depending on how you manage the loan. Making your monthly repayment on time can help improve your credit score by demonstrating responsible borrowing behaviour. However, if you miss payments or default on the loan, it may damage your credit score further.
Can I apply for payday loans with bad credit?
Yes, it is possible to apply for payday loans with bad credit. However, they typically come with higher interest rates.
Can I get a loan with bad credit and no guarantor?
Yes, you can get a loan with bad credit and no guarantor. However, the options available may be limited, and the terms might be less favourable than loans for individuals with good credit scores. Drafty offers unsecured loans that don’t require a guarantor, focusing on your current ability to manage loan repayments and not just your credit history.
Please think carefully about whether Drafty is the right solution for you. This is even more important if you're in financial difficulty. If we don't think you can afford to repay your credit, we won't be able to approve you. We'll look at your current finances and credit history before we decide whether to give you credit. Failure to repay could impact your credit file.