There may come a time when you look to a loan to pay for a large purchase at short notice. But whatever your reason for borrowing £400, we’re ready to help you make sense of the options available to you.
In this guide, we’re going to discuss your options for borrowing £400 so that you can find the best solution for your needs.
Is a £400 loan the right option for me?
Personal loans are certainly an option if you need an extra £400. They can be a quick and convenient way to borrow some money at short notice.
However, loans aren’t the only borrowing option and they aren’t always the most suitable choice for smaller amounts under £500.
In this case, you may find that a credit card is a more suitable alternative. There are several reasons for this, including:
- They’re a handy option for covering the cost of small or unexpected purchases.
- You could earn rewards from your provider by using and repaying your credit card regularly—and boost your credit score in the process.
- Credit cards offer more flexible repayment schedules than personal loans, giving you greater freedom in managing the debt.
- You would only have to pay interest on any remaining balance after you make at least the monthly minimum repayment—meaning you could clear the full £400 before it has built any substantial interest.
These are just a few of the reasons why a credit card could be an appealing alternative to a personal loan or overdraft if you’re looking to borrow £400.
Can I use a credit card to borrow £400 with a bad credit score?
Yes, you can. Even if your credit score is lower than you’d like it to be, you can borrow £400 on a credit card—but you may have a lower credit limit and higher interest rates as a result.
Your credit score could be lower if this is your first time borrowing money. It’s difficult for a lender to assess how reliable you would be at repaying the money you’re requesting if you have no history of borrowing and repaying debts.
However, a credit report that indicates a history of late or missed repayments could negatively impact a person’s credit score.
Thankfully, having a low credit score doesn’t have to stop you from using a credit card to borrow £400. You can use our free tool to check your eligibility for a credit card and we’ll help you understand your options.
We’ll do a soft search of your credit report and present you with some card providers we recommend according to your borrowing needs. This won’t be recorded on your credit file, so browsing these options won’t influence your credit score.
Can I apply online for a credit card to borrow £400?
It’s as simple as entering some basic details about yourself into our credit card finder tool, waiting for us to run a quick check, and then browsing the credit card providers we recommend according to your borrowing requirements.
Once you’ve applied for your credit card and opened your account, you’ll receive your card in the post—this usually takes between seven to 10 working days from the date you were accepted. You can then use your card to borrow the £400 you need by making the payment required.
Can I afford to borrow £400?
The most important thing to bear in mind when looking for a £400 loan or credit card is whether you can afford to repay this amount. You don’t want to be in a situation where you’re spending more than you can afford and accumulating debts.
If you’re planning to repay the £400 over a few months rather than all at once, you can calculate your monthly repayments by checking the minimum repayable amount and interest rate (APR).
Remember also that lenders typically only apply interest to the remaining outstanding balance on a credit card once some of the debt has been repaid.
As long as you keep on top of your monthly repayments and manage to repay at least the minimum amount, you should be able to afford a £400 credit card.
What can I use a £400 loan for?
A £400 loan could go a long way. Maybe you need some support to tide you over until your next payday. Or, it might be that you have some home improvements in mind and are considering a credit card to cover the cost.
Whatever the reason, a credit card could be a huge help if you find yourself needing to borrow £400.
There are a number of reasons people take out a personal loan. These include:
How do I repay the money I’ve borrowed?
When you borrow £400 on a credit card, your card provider will send you a statement at the end of the month. This statement will include the following information:
- The outstanding balance on your card.
- Any interest that has been applied to your debts.
- Your required minimum repayment amount.
- The date by which this minimum repayment must be made.
Compared to a personal loan, the repayment schedule for a credit card is more flexible.
To repay your credit card, all you have to do is meet the minimum monthly repayment amount before the date listed by your provider. Alternatively, you could pay off the debt in full if this option is available to you.
If you took out a personal loan for the £400 you need, this would be subject to a repayment agreement as soon as the loan was transferred. In this case, you would be required to repay the amount agreed on with your lender.
If you miss a repayment, on a credit card or a personal loan, your provider will likely apply charges or fees to your outstanding balance. You can contact your lender to discuss whether they can provide an extension if you are struggling to meet your monthly repayments.
Check your eligibility and start comparing credit cards to borrow £400
In short, a credit card could be a great option for you if you are looking for a flexible way to borrow and repay £400. With this in mind, simply head over to our credit card finder tool to start your search and we’ll help you browse and compare cards from different providers.
If you would prefer to borrow an amount higher than £500, then a personal loan may be a better fit for you. So head over to our free eligibility checker to see how much you could borrow and find the best lender for you.
Learn how much you can borrow
Do you have a different amount in mind than the one above? Check out our Loan Amount Guides series below.