Before the crash in 2008, most of the banks would give out loans to anyone, well almost anyone. If you had a mortgaged to the hilt house or maxed out credit cards you would still get a loan, because you may have been deemed as low risk by the banks. (now credit scoring).

Then the end of 2008, early 2009, the banks decided to review their policy and stop lending (to most), as their appetite for risk had changed dramatically, which opened up the flood gates for a new breed of lender, the Payday lender.

Soon after the banks turned their backs on most of us, the payday lenders swooped in to save the day offering great loan deals which could be paid back within a couple of weeks with, what looked like, a low interest rate.

We know how the payday lender story goes as many headlines appeared stating lenders were charging over 5000% Representative APR because people were rolling their loan over month by month or missing payments then trying to catch up, etc., etc., so the government had to step in to take control of the industry and put a cap on the APR these lenders could charge, so it was set to a maximum of 292% APR and the maximum amount you will ever pay on a single loan is double the amount you borrowed, so, no more 5000%.

Now, this brings me to the present day. If you have bad, poor or adverse (however you want to say it) credit then you’ll find it even more difficult to get credit today because even the short term lenders have now changed their risk appetite, so unless your credit score is in line with their new risk appetite you won’t even get a loan from them. This could leave you helpless in an emergency if you haven’t got a friend who can be your guarantor.

However, there are still a few options you could take if you really are desperate, you could try one of the new breed of lenders for short term loans who look beyond your credit score and lend based on a more human approach, or chance your arm at a high % APR credit card specifically designed for people with bad credit.

The best option is to plan ahead with money and not put yourself in a situation where you have to get a loan, even in an emergency, but if we could all plan our lives like that, we wouldn’t be in this situation would we?