#short term loans bad credit
Short Term Loans In The UK
The Availability of short term loans has exploded in the UK over the last 5 years. Pre-credit crunch, the personal loans market was more broadly available but concentrated on traditional style products – i.e. loans which typically ranged from £1,000 upwards and for loan terms of 1 year to 10 years. The truly short term market was dominated by 3 main products;
- Overdrafts – supplied by your high street bank
- Credit Cards – pre-credit crunch these were mostly provided by your typical high street names
- Doorstop Lending – now called Home Credit, these loan providers would offer small cash loans and come round to collect your cash repayments each week
Of the 3, only Home Lending really served those people with impaired credit histories.
Then after the credit crunch, the High Street Banks drastically tightened their criteria and the providers of traditional loans all but disappeared – leaving people with maybe only a small blemish out in the cold. Step forward the Payday Lenders.
The payday model came over from America and the Payday Lenders stepped into the void left behind, offering small, short term loans to those with less than perfect credit histories. The payaday model proved popular, very popular. For 3 or 4 years they had the market pretty much to themselves and they managed to move payday loans into the mainstream conscience of the population.
But poor publicity in the popular press led to a tightening of the regulations by the Financial Conduct Authority and over the last year the number of providers has shrunk. But instead have come a new breed of credit providers who occupy the middle ground. There are now a large number of providers offering loans that are smaller than the traditional-type loans but typically offering loan amounts of between £200 and £1000.
There are now a lot of providers offering short term credit on an instalment basis – i.e. instead of paying it all off at the end of the month you can spread your weekly or monthly payments over terms up to 1 year.
Logbook loan providers will ask you to put your car up for security and will cap the maximum loan amount based on the value of your car, e.g. up to 75% (subject to suitability and affordability). However, it does mean they can offer higher loan amounts than the instalment lenders assuming your car is of a high enough value.
Still a popular choice for many as it scores very highly on convenience and ease – having a representative collect payments from your home can make managing your loan much easier than having to set up Direct Debits.
Despite some bad press over the last couple of years there are still quite a few lenders offering loans over terms of up to 30 days. Increased regulation has cleared out some of the cowboys and those remaining have been subject to controls on interest rates and charges, which ultimately ensures a better deal for consumers.
With such a wide range of products and product types available it can be difficult to get the facts you need to make the right decision. Our loan experts are here to help by explaining the details of each of the products available – allowing you to pick the one that suits your best. Just fill in your contact details and we’ll call you at a convenient time to help you with your application. We have NEVER charged an upfront fee for our service and we never will.