Doorstep loans or home collection loans date back to the late 1800s. Historically, vouchers were passed on that could be exchanged in shops for clothing, coal and food supplies. Repayments followed on weekly instalments. Today money is loaned out and the borrower in most cases repays the same way. Low income families have remained the target audience, alongside those with bad credit or those new to borrowing. Such folk are excluded from mainstream banking products and it is this that birthed the UK’s subprime lending boom. Online products like the payday loan spiked in the early 2000s, but the home collected cash loan had been there for much longer and eligibility was greatly eased, that aided access.
Bad credit doorstep loans are widely available since all providers understand that their user base will be made up of those unable to qualify for a low rate bank loan or an overdraft. Credit checks are conducted, but past issues including CCJs and defaults can still pass. Likewise, having a low income or being self-employed isn’t an issue. What’s important is that affordability can be demonstrated. An agent could quickly determine this from looking at your recent bank statements. When risk is higher, the lender may lend a small £100 sum to see how well this is initially managed. The weekly repayments often last several months and so this can help to devise a more affordable repayment sum.
A few firms cover extensive areas, but most providers are small businesses covering their local area only. The CCA represents more than 420 home credit businesses that gives you an idea of the size of this industry. More than 1.3 million customers have been referenced as using these products. This is however a fractured tally since Provident has now closed and they had the lion’s share. Lender sites tend to very basic in their design. Amounts and terms tend to also be restricted. Repayment terms are always packaged weekly usually up to the year point, but through an agent can be settled early. Once you’ve applied, an agent will visit you to run through the process within several days.