Bad Credit FAQs

When you check your loan options through us, we run a soft credit check. This doesn’t affect your credit score in any way and is not recorded on your credit file.

When you check your eligibility, we try to show you as much information as possible after just a soft search, including real rates and your chance of approval.

Not sure what we mean by real rates? Check out our guide, What are real rates?

If you are eligible for finance, you’ll then see your loan options. If you decide to apply for a loan, your chosen lender may then run a hard credit check. This type of credit check is recorded on your credit file.

Yes, it is possible to get a homeowner loan with bad credit. This is because lenders secure the loan will against your home, adding an extra layer of security for the lender.

With a homeowner loan, you can borrow from £10,000 to £500,000+ and spread the cost over 1 to 30 years.

Bad credit homeowner loan considerations

That said, you should think carefully before securing finance against your home. If you are unable to repay your loan, as a last resort your lender could repossess your property to recover their funds. To be eligible for a homeowner loan, you’ll need to be a homeowner with equity in your home.

Warning: Late repayment can cause you serious money problems. For help go to moneyhelper.org.uk.

Second-charge mortgages 14.26% APRC Representative (variable). Representative example (if you choose to add fees to the loan): assumed borrowing of £25,000 over 7 years, plus a broker fee of £2,850 and lender fee of £367.50 would result in monthly repayments of £509.96, the borrowing rate is 12.78%, the APRC is 14.26% (variable), total charge for credit would be £14,619.14 and the total amount payable would be £42,836.64. Aro is a credit broker and not a lender. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.

If you would like to learn about what gives you a bad credit score, check out our blogs, guides and FAQs.

This very much depends on your individual circumstances. When it comes to personal loans, lenders will look at your credit score to decide whether to offer you a loan and determine your interest rate. Generally if you have bad credit, you will be charged a higher interest rate.

If a personal loan isn’t an option for you, you may still be able to consider:

• Guarantor loans
• Homeowner loans
• Credit builder cards

Although your credit history does play a big part in your eligibility for finance, there are other factors that a lender will consider, such as your income, expenses, the size of the loan you are looking for, how much debt you already have and your homeowner status.

Warning: Late repayment can cause you serious money problems. For help go to moneyhelper.org.uk

36.8% APR Representative (fixed)

Representative example: 36.8% APR Representative based on a loan of £12,500 repayable over 48 months at an interest rate of 36.8% pa (fixed). Monthly repayment of £500.83. Total amount repayable is £24,039.67.