Bad Credit Loans Explained

Using our access to specialist packagers, Caboodle can assist homeowners with a bad or poor credit history. If you have “bad credit” it generally means that obtaining a loan could be more difficult and some people are turned down when applying for finance.

A bad credit homeowner loan is a secured loan that is specifically designed for borrowers who have previously missed payments or defaulted on loans or credit cards, got County Court Judgements (CCJ`s) or mortgage repayments. Though bad credit loans typically charge higher interest rates to reflect the poor credit status, they can be very helpful in putting people back on track to repairing their credit rating so that they qualify for better rates on finance and mortgages in the future.

A secured bad credit loan could be used to consolidate your existing credit cards, store cards and unsecured loans leaving you with just one simple, manageable monthly repayment. Loans are available over terms of 3 – 25 years to suit your budget but it is important to remember that the longer the term the more you will repay in total, although many loans have low or no early repayment charges, meaning you are not tied in for any specific period and do not have to pay high penalties if you want to clear your loan early.

Even if you have poor or adverse credit, CCJ’s or mortgage arrears you could still qualify for a secured bad credit loan. As part of the enquiry process your Caboodle adviser will assess your personal circumstances and make a referral to one of the specialist packagers if a second charge mortgage is the most appropriate solution for you.

Frequently asked questions about bad credit loans

Is a secured homeowner loan the right solution for me if I have bad credit?

– Although bad credit loans for homeowners are the solution for many there may be alternative solutions available that suit certain circumstances.

Does taking out a bad credit secured loan improve your future credit rating?

– In many circumstances secured homeowner loans for people with adverse or bad credit can be the first step towards repairing and improving their credit rating.

How long does it take to repair my credit history after taking out a secured bad credit loan?

– There is no set period as credit reference agencies keep records of all financial transactions for six years. Depending on the severity of the adverse credit some people can see an improvement in their credit rating within 12 months.

At Caboodle we also have access to a wide range of bad credit remortgage plans which your adviser will be able to discuss with you if you feel this option may also be of interest.

Following some changes in regulation, Secured Loans are now commonly referred to as “second charge loans” or “second charge mortgages”.

The secured loans process is simple, either complete the short online enquiry form and a Caboodle adviser will contact you, or call us at no obligation on 0800 151 2407 or 0121 308 9114. Bad credit loans are just one of many services Caboodle offer.

Representative 7.65% APRC. Loans subject to status.

Representative example: Assumed borrowing of £20,000 over 120 months, with a borrowing rate of 5.9% per annum. There would be 120 monthly instalments of £235.50. Total amount payable is £28,260 comprised of; loan capital (£20,000); interest (£6,770); broker fee (£995); lender fee (£495). This would result in an overall cost for comparison of 7.65% APRC.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT. CONSOLIDATING DEBTS MAY INCREASE THE TERM AND TOTAL AMOUNT PAYABLE.