Compare Loan Alternatives…
(Secured: Buy Backs and Pawnbroker Loans. Unsecured: Store Loans)
Our first alternative comparison was directed at Subprime Credit Cards. Today, we’ll be investigating 3 varied retail products. The secured options include Buy Backs and pawn loans. The final choice is standard unsecured loans (payday, instalment or personal). There are some companies featured today that offer all of the 3 lending options, as well as various other financial services. There is an endless potential range of firms that we could compare here. The approach taken has been to start with the major high street brands and then on to those that have a notable profile. Before getting to the listings, we’ll begin with some basic information on each of the 3 lending retail choices.
To begin with some background information, Credit Strategy is a recent rebrand of Credit Today that went through a few months into 2016. They have now moved over to www.creditstrategy.co.uk. This change was sparked as a result of Shard Media Group Ltd acquiring the owner (Athene Publishing Ltd) earlier in the year. Athene has operated through events, magazines, web properties etc. The Credit Strategy Magazine started out in 1998 and it is today the industry leader, reporting on commercial and consumer credit. This magazine has a headed average circulation of 10,000 and a readership of 38,000. Their website that reports on current goings on in the industry is popular with professionals working in the financial sectors.
Compare Loan Alternatives (Credit Cards for Bad Credit)
Across the top menu bar you’ll spot the main comparison listings dedicated to loan providers across various niches. Most of which are focussed on subprime lending with the exception of “Bank Loans” and a portion of the entries in “Car Finance“. The future objective is to continually improve every comparison page, but at the same time we’ll be looking to expand with loan alternatives. The first of which that will be looked at today is UK credit cards for bad credit. This is a very competitive and popular sector, although there are only a few direct issuers. Most of the solutions are alternative trading brands of Vanquis or affinity branded cards by them or Capital One.
Most people understandably don’t have the money to shell out on a shiny new motor. The common solution for many is to apply for a Car Loan with their bank. The banks have however become increasingly picky these days and this is where car finance providers have stepped forward to fill the consumer demand. Financing is of course not just an option for those turned down by the banks. Those that like to change cars on a frequent basis can essentially rent out the latest model and skip to a new one in just a few years. This is particularly tempting when leading automakers offer 0% deals on their freshest creations of the production line.
Compare Bank Loans for Good Credit
Lenders4U primarily covers loans for bad credit, but today we’ll be switching to prime that will see leading banks going head-to-head. In making this switch, this will enable us to compare pricing variations between prime and subprime lending products. Readers intent on credit repair can also get a good idea of what value is possible in the future. This comparison page contains not just the major high street banks, yet also new age banking arms of leading retail brands such as M&S and Tesco. We have also included Nationwide. They are a building society rather than a bank, but it isn’t possible to cover building societies individually since most offer mortgage lending only.
Compare Logbook Loans for Bad Credit
Logbook loans are subprime products secured against a borrower’s logbook (V5C). The V5C document was previously known as V5 that is still often used as a generic term for this type of loan. Agreements are made on a Bill of Sale that is a legal contract between the borrower and the lender that an item of personal property was sold, but this property doesn’t change hands and it can still be used during the contract. The lender is protected with the right of seizure without a court order. They can take your car, sell it, and still chase up for any shortfall. Repossession is of course always taken out as the very last resort.
Last Update: August 23rd, 2016
Doorstep loans can be traced back to the late 1800s and this sector remains popular despite the online lending boom over the past decade. As the naming suggests, cash is delivered to the customer and the repayments are then collected on a weekly basis by a local agent. The terms are typically spread over several months and so affordable bitesize payments are made on collections. Bad credit is commonly approved and the service pricing is competitive. The companies involved in this space however haven’t adapted through the growth of the web. Select lenders run very basic websites and it is only the dominant lender that promotes their service extensively online and on the TV.
The guarantor loans niche started small, but it has been gathering huge traction in recent years. This is a bad credit personal loan with the distinction that the borrower must find support for their application. Guarantors agree to take full responsibility to the debt should repayment difficulties occur. They must have a positive score and so it really isn’t likely to see accounts escalating to become defaulted. This enables the lender to offer market leading subprime rates (from 39.9% onwards). They can also take a punt on poor credit that is only seen elsewhere in the logbook space. Thousands of pounds can be obtained that can be typically spread over 5 years.
Compare 12 Month Loans for Bad Credit (+Prime)
Unsecured personal loans for bad credit have always been in popular demand. The 12 month tagline is actually quite broad since various lenders may allow several months or a few years to be selected. In general though, they are targeting this niche due to high consumer demand. It helps that it is handy to compare pricing levels over a complete year. The Guarantor Lenders commonly start at this point, but you’ll need to find someone to support your application there. You can also access this term with logbook firms although those contracts are secured. The rates over a year are much lower than the alternative Instalment route. The freedom should also be there to settle early.
Compare Instalment Loans for Bad Credit (+Prime)
Instalment loans are marketed as a better payday loan alternative. The term is commonly stretched out to 3 or 6 months that helps to break down the chunky repayment seen in the traditional monthly products. The daily interest works out much cheaper in comparison to continually rolling over, although the FCA has now ruled out continual extensions (rollover limit is 2). The instalment sector hasn’t been booming, but its popularity has seen a spike in 2015. Through industry capping we have seen many shorter term lenders head into this niche. This is a profitable market to be involved in since whilst the rates are lower, the user is continually generating a return for the lender.
Best Value Sectors:
2) Finance (P): B/H/L @ 4.6%
3) 12 Month (P): First Direct @ 0.011%
4) Finance (Sub): Advantage @ 29.26%
5) Guarantor: UK Credit @ 0.053%
6) 12 Month (Sub): Likely @ 0.063%
7) Logbook: Car Loan Centre @ 0.108%
8) Instalment: Fair Finance @ 0.157%
9) Doorstep: Mutual @ 0.165%
10) Payday: Drafty: @ 0.180%
11) Short-Term: Drafty @ 0.180%
* Daily interest to 3DP
* Finance rates shown as APR
* (P) = Prime | (Sub) = Subprime
* Sainsbury’s leading rate is 3.1% APR.