From 11 December 2023 some of our fees are reducing. These changes do not impact our interest rates. See full details 
Bad credit – it happens. But a few past mistakes don’t have to stop you from getting a loan now. Here’s how working with a broker could help ease your way with a bad credit loan.
Read more: Should you get a personal loan through a broker?
WHAT IS A FINANCE BROKER?
A finance broker’s job is to link you up with the lender and loan that is right for you.
There are lots of different kinds of brokers, including:
- Finance brokers for personal loans or vehicle loans
- Mortgage brokers for home loans
- Dealers for vehicle loans
- Business finance brokers for (you guessed it) business loans.
The only difference is the product that they specialise in. If you have bad credit and are looking for a home loan, for example, it’d be best to go to a mortgage broker.
You may also see them referred to as ‘advisers’. Brokers and advisers are similar, though advisers can give advice on where you can get a loan and the best way to structure your loan.
Wondering why bad credit is such a big deal? Find out more: What’s a good credit score and why does it matter?
HOW DOES A BROKER HELP ME?
One of the most frustrating things about looking for a loan if you have bad credit is having to apply over and over and over to lots of different lenders, only to get a rejection after they do a credit check.
Every responsible lender will take your circumstances into account when considering a loan application. That includes any ‘adverse lending history’ AKA ‘bad credit’. The difference is what each lender considers to be a dealbreaker.
Some lenders have very strict criteria. Missed payments and defaults in your recent lending history could mean a rejected loan application.
Other lenders may take a different approach and are more focused on your ability to repay the loan going forward. They may accept a loan application from someone with a bad credit history as long as there’s a good explanation.
The difficulty is knowing which lender’s approach best suits you. That’s where an adviser can help.
An adviser saves you time and energy by:
- Handling the applications for you
- Applying to the lenders who are more understanding
- Providing advice on how to best structure your bad credit loan
In other words, they do most of the work for you!
All you have to do is provide some information (including an explanation of the reasons for the bad credit), and they handle the rest. Just one set of forms and, depending on the broker you go through, their services may be free. Brokers will (in some cases) get paid a commission by the lender they set you up with.
SUMMARY
If you have bad credit and are having trouble getting a loan, a finance broker may be able to set you up with a lender who can help when others can’t. It’s simple, and all it takes to get set up is a few forms. Easy as.
If you’re looking for a bad credit loan, ask your local finance broker about your options with Avanti Finance.
This article is solely for information purposes and is not intended to be financial advice. If you need help, please contact Avanti Finance or your financial adviser. Neither Avanti Finance nor any person involved in this article accepts any liability for any loss or damage whatsoever which may directly or indirectly result from any information, representation or omission, whether negligent or otherwise, contained in this publication. References to third-party websites are provided for your convenience only. Avanti Finance accepts no responsibility for the availability or content of such websites.