How Poor is your Credit Score?

By: Gracy Bonsu

The UK loan market has evolved greatly over the last few years. New products and technology have entered the frame and the competition among the lenders has also increased. This has done wonders for customers, as the lenders, especially the private ones, have become more liberal in their terms and conditions for granting loans. There was a time when loans were granted only to those who could furnish some asset like home as security. But then, unsecured or personal loans came to the market and swept the borrower's attention like anything.

Personal loans are given by the borrowers on the basis of the creditworthiness of the borrower. In other words, lenders prefer giving loans to those with neat repayment record, low credit utilisation ratio and high credit score. The high-street banks and the building societies are particular about their policies when it comes to unsecured or personal loans. However, online and private lenders do offer and lend money to those with adverse credit.

Bad Credit Loans are a relief to those who can't offer anything as collateral and have bad credit on top of that. In such extreme situations, the sub-prime lenders grant loans. Though these loans attract high rate of interest, they are particularly helpful in getting money at the time of financial adversity. But, before the lender gives you bad credit personal loan, he judges as to how bad your credit score is. A credit score below 650 on a scale of 800 is generally considered bad. As we go down the line from 650, it worsens.

So, the borrower must be aware as to how bad his credit score is before applying for bad credit personal loans. The best way out to is to surf websites like experian, check-my-file and equifax that provides free service for calculating the credit score.

Credit Matters
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