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Can I Get a Personal Loan With a 400 Credit Score?

It can be difficult to get a loan with a favourable interest rate with a 400-credit score and if already in debt. A consolidation loan could simplify your finances.

Financial hardships and unexpected expenses can lead to a poor credit rating. This often results in difficulty obtaining loans or credit from traditional lenders, who can view those with a history of missed payments too risky to lend to. Many individuals with a low credit score may therefore assume that personal loans are out of reach.

Fortunately, this is not necessarily the case. If you have a credit score of 400, loan borrowing may be possible, even if it requires shopping around and exploring different options. There are many lenders that specialise in providing financial assistance to those with less-than-perfect credit. However, it’s important to understand that interest rates and fees may vary, and loans are not a one-size-fits-all solution.

Here at Consolidation Expert, our lenders may be able to provide a debt consolidation loan to help you regain control of your finances, and start to restore your credit score.

Representative 14.8% APR

We are a broker, not a lender.

Representative Example: Borrowing £15,000 over 60 months, repaying £355.28 per month, total repayable £21,316.57.

Total cost of credit £6,316.57.

Interest rate 14.8% (variable).

The lenders on our panel offer loans for 12-360 months, with rates from 4.7% APR to 42.6% APR.

The Representative Example is based on all loans paid out by lenders between 1st Jan 2022 and 31st Dec 2022.

Key Takeaways:

  • Despite having a credit score of 400, you may be eligible for personal loan options that are easy and convenient to obtain.
  • There are various types of loans available to those with lower credit scores. These may include guarantor loans and consolidation loans.
  • Factors such as employment stability, income, and debt-to-income ratio play a crucial role in determining loan eligibility even if you have bad credit.
  • Improving your credit score through responsible financial management can help you qualify for better loan options in the future.

Understanding Credit Scores

Before we delve into the specifics of obtaining a loan with a 400 credit score, it is crucial to understand what a credit score is and how it is calculated.

Simply put, a credit score is a numerical representation of an individual’s creditworthiness. It is used by lenders to assess the likelihood that a borrower will repay their debts on time. The higher the score, the lower the risk for the lender.

In the UK, the three main credit reference agencies are Equifax, Experian and TransUnion. Each of these use a different metric for measuring credit scores, so your score will mean something different depending on which agency you are using:

  • Transunion credit scores are out of 710. A score of 400 with TransUnion is considered ‘very poor’. Anything 604 or above is considered ‘good’, with scores of 628+ deemed ‘excellent’.
  • Equifax credit scores go up to 1000. An Equifax score of 400 falls within the ‘poor’ category. Scores of 531 and above are considered ‘good’, while 811+ is ‘excellent’.
  • Experian credit scores max out at 999. A score of 400 is deemed ‘very poor’, with ‘good’ credit ratings starting at 881, and 961+ are considered ‘excellent’.

Your credit score will be calculated based on various factors, including payment history, credit utilisation, length of credit history, types of credit used and recent credit inquiries.

A low credit score can make it challenging to obtain loans and other forms of credit. Lenders may view individuals with poor credit ratings as high-risk borrowers who may be unable to repay debts on time or in full.

400 Credit Score Loans: Your Options

If you have a credit score of 400, loan approvals may prove to be a challenge. This is because many lenders could consider someone with a ‘poor’ or ‘very poor’ credit score to be too high a financial risk.

However, this does not mean that borrowing money is impossible. There may still be options available to you, depending on your individual circumstances. For example:

  • Secured loans: If you own assets like a car or property, you might be able to secure a loan against them. This reduces the risk for the lender but increases the risk for you, as failure to repay could result in the loss of the asset.
  • Guarantor loans: With a guarantor loan, a friend or family member agrees to back up your loan and cover repayments if you can't. This might enable you to borrow despite a low credit score.
  • Short-term or payday loans: While not recommended for long-term borrowing, due to high-interest rates and potential fees, some payday lenders might offer loans to those with low credit scores. It is crucial to approach this option with caution, as there are significant financial risks involved.

Another potential solution is to seek out a consolidation loan from a lender that specialises in offering debt consolidation loans to those with poor credit scores. This is a type of personal loan that aims to simplify your debts by combining them into a single monthly payment, potentially with more manageable terms.

Keep in mind that interest rates may be higher than other forms of loan, and approval isn’t guaranteed. Also, if you extend the term of your debt, this may increase the amount you repay overall. Always compare options and read the terms carefully to ensure that consolidating is beneficial for your financial situation.

Factors Affecting Loan Eligibility

Several factors can affect your eligibility for a loan, whether it’s a personal loan, consolidation loan, or another type of credit product. Here are some of the key factors that lenders typically consider:

Factor Description
Income Borrowers with a stable and sufficient income may be more likely to be eligible for loans despite their credit score.
Employment stability Lenders typically prefer borrowers with a stable employment history, demonstrating their ability to repay the loan.
Debt-to-income ratio Borrowers with a high debt-to-income ratio may be considered risky, as they may struggle to make loan payments on top of their existing debts.

Understanding these factors can help you assess your likelihood of being approved for a loan, even with a poor credit rating, and possibly take steps to improve your eligibility before applying. It’s always advisable to speak with a financial advisor or lender directly to understand the specific criteria they will use to evaluate your application.

Applying for a Loan with a 400 Credit Score

If you have a low credit score, the first step in applying for a loan is to obtain a copy of your credit report. This should give you an idea of where you stand. Review the information on file and report any inaccuracies that might be lowering your score.

Mainstream banks and loan providers might be less likely to approve loans for a 400 credit score, so you may need to look into lenders who specialise in poor credit loans. Familiarise yourself with their eligibility criteria for an idea of whether your application will be successful.

Carefully compare the terms, interest rates, fees, and other factors of different loan products. Applying for a smaller loan or a shorter term might increase your chances of approval.

Once you’ve selected the most suitable lender and loan product, follow the application process as outlined by the lender. Being rejected for a loan may harm your credit rating further, so if possible, choose a lender that offers a ‘soft’ credit check before you apply.

Gather proof of income, employment, residency, and any other documents that can demonstrate your ability to repay the loan. Double-check your application before you submit it: any mistakes may cause delays or result in your loan being delayed or rejected.

How Consolidation Expert Can Help

At Consolidation Expert, we understand the challenges of applying for loans with a poor credit rating. We believe that your credit history should not stop you from taking steps to manage your debt.

If you have a low credit score and are struggling to manage multiple debts, a consolidation loan may help. This can be used to pay off various types of unsecured debts, including personal loans, credit cards, payday loans, overdrafts, and more. Combining these debts into one loan could help to simplify your finances and potentially reduce your monthly repayments.

We pride ourselves on being a reputable and FCA-compliant broker. We work with a variety of lenders that consider a wide range of credit scores, offering loans between £5,000 and £75,000 with no upfront fees.

To find out how Consolidation Expert can help you, apply online today. Our initial application is a soft credit check that will not affect your credit score.


Depending on the credit reference agency used, a score of 400 credit score may be considered ‘poor’ or ‘very poor’. It usually indicates a history of financial missteps like missed payments, defaults, or even bankruptcy. Lenders may view this score as a risk and may be less likely to give you a loan.

Improving your credit rating is achievable even with a score of 400. Paying bills on time, reducing credit utilisation, and disputing any errors on your credit reports can help improve your score over time. Building a positive financial history takes time, but it should gradually improve your credit score and borrowing prospects.

While it may be more difficult, it may be possible to get a personal loan with a credit score of 400. At Consolidation Expert, we work with a variety of lenders that specialise in offering loans to individuals with a range of credit scores. However, be aware that interest rates may be higher if you have poor credit.

Bad credit loans, guarantor loans, secured loans, credit union loans, and consolidation loans might be accessible if you have a 400 credit score. Traditional bank loans may be challenging to obtain due to the stringent credit requirements they often have.

Lenders consider factors such as income, employment stability, and debt-to-income ratio when determining loan eligibility for individuals with a 400 credit score. Offering collateral, finding a guarantor, or applying with lenders specialising in poor credit might help. Considering a smaller loan amount or shorter term may also improve your chances.

Being rejected for a loan could harm your credit rating further, so try to avoid this by applying with lenders that offer a soft initial credit check. If you are rejected, seek professional financial advice for help exploring other options.

Debt consolidation can simplify your finances by combining multiple debts into a single loan with potentially more favourable terms. Instead of juggling various payments, you’ll make one monthly payment, which can make managing your debts easier. However, it’s essential to understand that consolidation isn’t suitable for everyone, and interest rates may be higher if you have a lower credit score.

For more information and advice on finding the ideal consolidation loan for you, contact Consolidation Expert today.

Further reading

Read Is it Possible to Consolidate Short-Term Same Day Loans?
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Read Can I Consolidate Holiday Loans with Other Debts?
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Read How Can I Pay Off My Debts Faster?
Man running in front of debts with a stopwatch behind