Take your finger off the mouse before you take that "easy online loan" and let's go through your best options depending on how much you want to borrow, even if you have a bad credit rating.

But first...

Here's why you should simply never take a payday loan...

Payday loans are designed to trap you in a cycle of debt. When an emergency hits and you have poor credit and no savings, it may seem like you have no other choice. But choosing a payday loan negatively affects your credit, any savings you could have had, and may even cause you to land you in court.

Either you have a decent credit score and you can get much better terms or you need to fix your credit score and we'll show you how.

There are always better options for a personal loan than payday loans, so just dont do it.

I'll give you the cheapest interest rate approach and the best ways to borrow in the UK from £100 pounds to £7,500.

From a secured loan to an unsecured loan to the best lender and monthly repayment loan agreement, we have you covered.

But before we get into the best interest rate and repayment plans for the different loan amounts, there are some little-known borrowing rules that will save you lots of heart-ache.

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Do you really need the loan?

Stop and think, do you really need the loan? Can you sell things you aren't using anymore or push back the purchase? Someone will always lend you the money, but you will pay higher rates and there are often better options than going into debt.If you need a loan for essentials like food and rent, probably you don't need a loan, you need help. Call the free government Money Advice Line on 0800 138 7777.

If you've decided you simply must get a loan, however, you could get a guarantor loan with a family member who is willing to take on the monthly payment if you default or you could get a loan from Community Development Finance Institutions (CDFIs), but be careful. If you can't afford repayments, you still need to pay back the loans and your guarantor will be forced to make payments on your behalf.

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Wishborn

Getting a loan to pay back other loans can be a trap

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If the loan is for debts, then read this...

Debt consolidation loans. How do they work?

Consolidating debt can help you get control of your finances and reduce the amount of interest you pay on your debts. Debt consolidation involves paying off existing debt over a period of time until the balance is zero. When debt levels are high, this may not be possible.

But, there are a few risks to consider before taking out a consolidation loan. It's important to get impartial advice before proceeding.

Don't confuse debt consolidation however with debt management.

Debt consolidation is a way to take out new credit to pay off your debts. Debt management, on the other hand, is where you, or a debt management plan provider, negotiate affordable payments with the companies you owe money to.

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Is it a good idea to consolidate your debt?

While debt consolidation may be a good option for some, it is in no way a guaranteed solution to all debt problems. If you do decide to take out a debt consolidation loan, you will only have one company that you are paying back each month.

If you’re having trouble paying down your debts, then you may not be able to afford a loan like debt consolidation. Take a look at your income and expenses to see how much you have available and make sure that the repayments are something.

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What’s an unsecured debt consolidation loan?

Unsecured means a loan is not secured against your home. A borrower can fall behind on payments and still be able to repay the loan. Unsecured loans however often end up costing you more in interest over the life of the loan, and they are also riskier because you can end up owing more money than you borrowed.

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Do consolidation loans hurt your credit score?

If you have a poor credit history, you may be offered consolidation loans with higher interest rates. If this is the case, consolidation loans may not be the best option for you.

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Can I get a consolidation loan with poor credit?

If you keep up with all your payments, the new loan won't have much of an effect on your credit score. But if the overall cost of the new loan is too high, and you miss any payments, this will be recorded in your credit history.

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Is consolidating debt worth it?

Debt consolidation is a tempting option for many people, but it's important to understand what the risks are. For example, you might be told that debt consolidation gives you one monthly payment and makes your debt more affordable. However this isn't always the case.

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Things to consider before taking out a debt consolidation loan

Always pay off all your debts. Don't borrow from friends or family. If you can't pay off your debts, get impartial debt advice.

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Debt Management

Debt management is a service provided by certain companies that consolidate all of your debt into a single monthly payment. The payment is then split among all of your creditors. Many UK debt management companies charge fees for their services. Debt advice and management from StepChange is free.

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How to apply for a DMP

To find out if a DMP is the right debt solution for you, use our online debt advice tool or speak to one of our expert advisors.

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wishborn

Getting a loan can foster financial rejuvenation

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Still want a UK personal loan?

Here are the golden loan club rules so you don't get scammed or end up paying off debt for the next 5 years.

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How to get a loan without losing your shirt

Ok, so you decided you just have to get a loan, you can't see another way out. So let's walk through the smartest approach.

Keep in mind banks are no more likely to give you a loan than anyone else, you'll still need a credit check from any loan provider or credit broker. A loan repayment schedule is based on your credit file and credit history. Click our link in the description for a free credit check now.

Next, start by working out how much you can afford to pay back every month and for how long. Perhaps you need £1,000 and you know you can afford to pay off £100 a month after all your bills are paid.

Now, knowing how much you can pay back, look for lenders who will offer those terms. This way you will never overextend yourself, and you are more likely to get the loan the first time around avoiding multiple hits on your credit rating which can hurt you later.

Shop around lenders who let you check your chance of acceptance without actually doing a credit check. -click the eligibility link in the description and fill in that info to find out your options.

If a lender does do a real credit check and you don't get the loan, don't apply to another lender until you find out why you were refused.

Ask the lender why you were refused or do another credit check so you can fix the problems. There's a link below showing you how you can improve your credit rating, it's not as hard as you might think.

The last rule is, when you finally do get a loan, always borrow as little as possible, and choose to pay it back as soon as possible to sidestep avoidable interest.

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APR vs. Interest Rate.

The difference between a representative APR and an interest rate is that the APR is more relevant. The APR represents a combination of the interest rate and other loan costs such as add-on fees, taxes, or insurance. An APR is easier for consumers to understand than a pure interest rate. It can be a great tool for lenders like credit card companies, money markets, and mortgage companies to communicate the total cost of borrowing money.

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Different loan amounts require different approaches

Ok, here's the breakdown of the best ways to borrow money in the UK from £100-£7,500.

For loans of £0 - £100, your best bet is to simply ask friends and family, use your credit card, or even your bank overdraft. If you can pay it back within 30 days, it will come out a lot cheaper than using Payday loans. You can save the money over 30 days and sort it out.

£100 - £250. If your friends and family can't help out, ask your boss for a pay advance, many companies are willing to help you out especially if you are a valued worker. You can also apply for a new credit card which is still a great option if you plan to repay within 30 days. Most credit card companies will give you an immediate limit of up to £250 so it can't hurt to do a soft check to find out if you're eligible without raising any alarms by actually applying and causing a credit check. Click the credit card link in the description

For loans between £250 - £4,000 Use a 0% Purchase credit card over 24 months. Apply on moneysupermarket.co.uk. See the link in the description. Under £5k you want to avoid loans or you'll be paying around 25% APR which is the annual cost of a loan with everything included like charges and fees.

If you need to borrow longer like for 4-5 years, switch from a purchase credit card to a balance transfer credit card after 2 years on 0% deal, to get a 5 loan term around 3% for less than 0.4% per year overall. That's a great deal.

For anything between £4,000 - £7,500, you can get 2 purchase cards at 0% interest! Make sure you get both cards at the same time though. First, do a soft search using the "purchase card" and then immediately go back to another credit card provider and get the second one. Make sure you can actually make the repayments though or you'll get burned in the end.

If you don't manage to get the two cards, you can look at larger loans using the eligibility search link in the description below. You might also want to check out peer-to-peer loans that have much better terms. Make your loan application using the links below.

The trick here is to make sure that you find out the thresh holds for each bracket of interest rates. Often, if you borrow less than £7,500 you might have to pay 5%-10%-15% whereas, above £7,500, the rates might be as low as 3%-5%. Your best move here is to take a loan for example for £7,700 even if you only need £5,000 at hopefully roughly 4%, keep the £5,000 and then a few days later pay back the £2,700 extra. That way overall you're looking at cheap personal loans and your credit score is looking good.

For larger amounts, you can always consider an unsecured personal loan if you have a good credit history.

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Conclusion

Remember, always check with your financial advisor or just have a chat with your friends and family before making big money decisions, and only borrow as much as you need and no more. If you don't think you can make the repayments, don't take the loan. It will only hurt you more in the long run.