All of us are guilty of living in the past regrets longer than we ever wanted to. Poor debt management is one such gift of the modern lifestyle, and as a result, thousands of people struggle to find appropriate funding sources every month in the UK. Many people take longer to realise their merits and keep suffering by focusing on the failures and wrong decisions indeed.
This article aims to assist borrowers with less than perfect credit score knows about the lesser-known truth about availing affordable funds for home repair with poor credit rating.
The ‘Challenge’ for Bad Credit Borrowers
Whether you seek short-term loans for home improvement or wish to spend on home extension (so as to improve the value of your home) financing the same could be difficult with poor credit. Even small home remodelling projects can cost you a fortune, ranging from £10000 to £50000. With the high debt to income ratio, neither credit card limits nor overdraft limits can suffice your needs.
You would need a well-planned instalment loan for a well-defined home repair project. The duration of loan needs to be at par with your repayment capacity. You may require loans for 12 months to 84 months. With low credit worth, main street lenders would not consider your loan application.
The ‘Solution’ Lies in Home Equity
Nevertheless, there are several ways to borrow short-term loans for homeowners. You can consider using home equity despite the current mortgage. The loan works independently of your previous loan and acts as a second charge against your property.
With home equity, the loan is offered at the lower interest rate and becomes easy to manage. You do not need a guarantor or a very high credit score to back your application.
However, before signing the dotted lines, it is important to study closely your loan affordability factor. Being a homeowner, you can also qualify for personal loans without raising a loan against your home. Thus, the decision for a secured or unsecured loan should be reached at carefully.
Making the best of the available deals
Considering you seek best short-term loans in the UK, you can contact a loan broker and use free professional loan assistance to get access to all available deals. This would help you compare the available loan rates and pick the best deal. Using professional guidance, you can also get your profile assessed and know about your loan repayment capacity.
What Makes a Loan Deal Perfect for You?
The cost of a loan is one of the key factors to consider. However, it is not the only factor. As important as it is to borrow a loan on affordable instalments as is to consider the total amount you would pay to close the loan. You should be careful to not borrow very long-term loans, or you may find yourself repaying as much in the interest as the gross amount.
With poor credit, it is always advisable to keep the loan burden low. You should borrow strictly with a budget in hand. Borrowing more than what you require could be suicidal for your financial health.
Thus a loan deal that offers ease of repayment and hope for successful closure should be opted for. Bad credit loans should always be used as last chance loans. There should not be a room for non-payment.