Where can I find the best loans for people with CCJs?
Loans for people with CCJs are likely to be more expensive than for those with a clean credit history, and generally harder to get hold of. When you apply for credit, the lender will do a credit search to determine your creditworthiness, and having a CCJ (county court judgement) on your record will mean that you are a risky customer to lend to – this will mean higher interest rates.
The following may offer loans for people with CCJs:
- Specialist bad credit loan companies
- Mainstream lenders (but they might be more expensive)
- By comparing deals from a number of providers
How much do loans for people with CCJs cost?
If you are offered a loan, then how much interest you are charged can depend on a number of things.
- How much you want to borrow
- Over what period of time
- If you need a homeowner loan
Secured vs unsecured loans for people with CCJs
Bad credit unsecured loans generally offer less competitive rates than adverse credit homeowner loans; this is because you are not offering any surety to the lender so the risk of default could be higher.
If you use your home as a guarantee, lenders are more likely to offer you lower rates and longer repayment periods. But, despite the fact that lower rates are available on secured loans, the potential risk of losing their home puts most people off - around 90 per cent of loans fall into the unsecured category.
You may find, however, that if your credit history is poor, lenders will only be prepared to lend to you if you can offer some sort of surety; secured loans for people with CCJs are sometimes the only option, unless you are willing to pay very high rates of interest.
If you are successful in your application for a bad credit loan, then you can use this to improve your credit rating. By keeping up with the repayments and proving that you have become more of a trustworthy borrower, then you will gradually repair you credit score and in the future be able to apply for loans with more competitive rates. (Learn more about how to improve your credit rating.)