When you apply for credit a lender has to make a decision on how likely you are to repay the loan and how much interest they should charge you. Credit history is a record of your ability to repay debts and demonstrated responsibility in repaying them.

It’s possible to improve your credit scores by following a few simple steps, including: opening accounts and maintaining low balances, and paying your bills on time.

Bad Credit Loans

If you have a poor credit rating you can still apply for loans by opting for a bad credit loan. This type of loan made specifically for those with a poor credit history. Poor credit loans usually charge a higher interest rate than regular personal loans, as lenders take a greater risk by providing funds to those who might be more likely to default.

Guarantor Loans

This involves the borrower arranging for a second person to pay off the loan in case they can’t make the repayments themselves. This lowers the risk the lender takes when loaning money to someone with a poor credit rating. A guarantor for a loan should be someone who knows you really well. Being a guarantor for a loan is a big commitment and it’s important you both understand and are comfortable with what’s expected of you when you agree to take out the loan.