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What Finance is Best For You


Finance is a broad term – there are so many options available to you. From store cards to instalment loans for bad credit, there’s no shortage of how you can get credit, regardless of your credit rating. Over 60 million credit cards were in use last year and over 2 million people took out a short term loan, showing that lending can be a safe option. The short term loan industry has really improved in the last five years and is now seen as a fantastic way to cover unexpected expenses. But what finance is best for you? Here’s a summary of the various options available to you and which ones are the best choice.

Bank loans

A bank loan is paid off in instalments over a set period of time – anything from 12 months to 7 years. Mortgages are effectively a bank loan used solely to buy a house. It’s secured against your home and paid off in monthly instalments via interest-only payments or fixed payments. You can also take out a bank loan that isn’t classed as a mortgage. The rates can be very fair but are dependent on your credit history. For example, if your credit score is low then you’ll pay extortionate interest rates – that’s if you even get accepted because banks are very strict with who they give loans to.

Short term loan

If you go with a reputable company like My Financial Broker, you’ll find that short term lenders can offer great customer service and fast payout times. We offer loans from 1 month up to five months – so you really do get a great deal of flexibility. The best short term loan lenders like My Financial Broker are extremely transparent with costs and interest rates, so there are no shock-surprise fees. We’re authorised by the Financial Conduct Authority (FCA) so we always make it clear how much you’ll pay back, as well as any potential late payment fees. Short term loans are highly recommended for people with a secure, regular income who need a bit of extra cash to cover emergency or unexpected expenses such as car breakdowns, fitting a new boiler, emergency prescription and so on. Short term loans are designed with you in mind, so if you take one out responsibly it’s really easy to pay them back and it could give your credit rating an amazing boost.


All banks offer an overdraft facility, but you usually have to apply with them to get it (unless you have a student account!). If authorised, your bank sets your overdraft limit, so when you go past ‘0’ on your account you’ll have a financial cushion to fall on. But if you go over your overdraft it can be very costly in the long run – as the bank will charge you unplanned overdraft fees. The size of your overdraft will depend on your bank account activity and your needs. For example, you may get a £500 overdraft because your bank account shows you have a healthy regular income and little to no debts, whereas if your bank account shows a lot of debt going out and a poor or no income then you’d be refused. Banks are fairly strict with overdrafts so they’re not really suitable for those looking to build credit or those with a poor credit history.

Credit cards

Credit cards are flexible in terms of who can successfully apply for one. From credit builders to exclusive cards for businesses, there’s one of nearly every financial background. However, they do come with very high interest rates and you’ll most probably be charged a fee if you want to withdraw cash. This can all add up in the long-term and should be used very responsibly.

Peer to peer lending

This is where you apply for a loan from an online community. You’re effectively borrowing a real person’s money. The lenders on peer to peer lending sites use them to earn interest on their savings. But there are a few disadvantages to using peer to peer lending – you’ll need a fairly high credit rating to use the service. There are also several downfalls for the lenders too – you may need to lock in your cash for a minimum of one year and you probably won’t’ be covered by the Financial Services Compensation Scheme (FSCS).

Guarantor loan

You’ve probably heard of having a guarantor for your rent – where someone you know signs your tenancy contract and pays any outstanding rent if you can’t. A guarantor loan is pretty much the same! Typically, your guarantor must be a homeowner in full-time employment. He or she will cover the repayments of your loan if you can’t. It can be a good alternative for those of you who have a poor or very poor credit rating, but it can be damaging to your relationship with the guarantor if you don’t keep up with payments. My Financial Broker offer fast loans for poor credit with no guarantor if you’d rather not have to find a family member or friend to secure credit.