Bad credit can be created due to varied reasons like County Court Judgments, missed repayments, arrears, defaults etc. these factors lower the credit score of the borrower. a score lower than 580 is considered to be bad credit in the credit report issued by FICO. In such a case, the borrowers are not easily lent money as there is a risk involved with the repayment of the loan. But now, bad credit loans have come to the rescue of bad credit borrowers.
Bad credit loans can be categorized into two bifurcations of secured and unsecured bad credit loans. Unsecured bad credit loans help the borrower in taking up money without pledging any collateral with the lender. He can borrow an amount of £1000-£25000 for a term of 6 months to 10 years. The compensation for the risk is made by the lender by charging a high interest rate on the bad credit loans.
To get a lower interest rate, the borrower can pledge any of his assets with the lender as security and thereby borrow secured bad credit loans. The amount that can be borrowed ranges in £5000-£75000 and has to be repaid in a term of 5-25 years. Rate of interest is low due to attachment of collateral with the bad credit loans.
Bad credit loans can be categorized into two bifurcations of secured and unsecured bad credit loans. Unsecured bad credit loans help the borrower in taking up money without pledging any collateral with the lender. He can borrow an amount of £1000-£25000 for a term of 6 months to 10 years. The compensation for the risk is made by the lender by charging a high interest rate on the bad credit loans.
To get a lower interest rate, the borrower can pledge any of his assets with the lender as security and thereby borrow secured bad credit loans. The amount that can be borrowed ranges in £5000-£75000 and has to be repaid in a term of 5-25 years. Rate of interest is low due to attachment of collateral with the bad credit loans.