We all need to find some extra cash from time to time. Whether it is paying the bills or to cover a one-off expense, being able to borrow funds when necessary makes life a lot easier.

But what if a poor credit score makes this more difficult to arrange than it should be? The Australian Securities and Investments Commission offers tips for improving your credit rating, but these ideas can take time to cause a positive effect on your score.

Therefore, knowing how you can borrow even with a bad credit history can be essential. Thankfully, there are some popular types of the loan than you can consider when you are in this situation.

No Credit Check Loan

Perhaps the simplest approach is to use your assets as collateral to get a loan that can be completed without any sort of credit check being done. This is typically a fast, painless transaction due to the fact that a cash loan against car is based purely on your ownership of assets worth more than the amount you are borrowing.

This means that it can be the ideal solution if you need some money urgently. If you have, for example, some sort of vehicle that you can use to get hold of this kind of loan then it lets you sort things out very quickly and easily.

Family or Friends Loan

Could this be the best option for you, or could it turn out to be a total disaster? Borrowing money from friends or family can be a good idea provided that it is carried out in the right way. For a start, this should be a fast way of getting hold of the money that you need. There is also no hassle with paperwork in order to get approached.

Perhaps the most important point here is to be very clear from the start about how and when you will pay it back. There are some reasons why family and friend loans are often seen as a bad idea, but if everyone treats it as a serious transaction and sticks to a firm agreement, then there is no real reason that it should turn into a problem.

Unsecured Bad Credit Loan

There are lenders who will offer unsecured loans to people who have bad credit. This can seem like the only solution for anyone who has poor credit score but doesn’t have any assets that they might use to get a secured loan.

Of course, a loan of this type represents a big risk in the eyes of the lender. So it is likely that the interest rate is quite high and the qualifying criteria rather strict. However, if you desperately need cash and can’t see any other way out, then it can still turn out to be a big help.

Peer to Peer Loan

The peer to peer loan market has really grown enormously in recent years. It is said that this market will grow at a CAGR of over 25% in the next few years. This means that it is going to be an increasingly high-profile opportunity for those borrowers with a less than ideal credit score.

With the peer to peer approach, the lender may still carry out a credit check. However, there is usually more flexibility for them to accept a riskier proposition by increasing the interest rate or otherwise adjusting the terms and conditions.

Guarantor Loan

If all else fails, then you might like to consider the approach of asking someone to act as a guarantor on your behalf. In this way, they assume a degree of risk, as they agree that they will ultimately be responsible for paying back the loan if you default on it.

Naturally, you are only likely to ask a close relative such as a parent to do this for you. It is a serious undertaking for your guarantor and not something that either party should enter into lightly.


Having a poor credit score doesn’t mean that you can’t get hold of a loan. However, it does mean that you may need to be more creative in terms of how you arrange it. By choosing the right type of loan for your situation, you can go back to enjoying life with fewer financial worries.