Common questions

The UK loans market is very crowded, so it's unlikely that the first loan you find will be your best choice. Even the loan with the cheapest APR might not be suitable for you, so you should take a look at all your options before making such a big decision with your cash. The uSwitch.com loans comparison service will do this for you in a matter of minutes.

We ask you a few simple questions about how much you want to borrow and how long you need to repay the loan. The loans comparison service will work out which of the loans available is right for your circumstances, and will give you a list of the best deals. All you have to do is choose between them, and then you can start the application process.

The complicated part is choosing which loan to apply for, and this is why the uSwitch.com loans comparison service exists. When you apply to your chosen lender, you will be asked some questions about yourself, such as your address and bank details, so that the loan company can perform a credit check. When this is complete, you will be given a decision.

That all depends on your financial circumstances; the personal loan company will check with credit reference agencies to make sure lending to you won't be too big a risk. If your credit record is flawless, you have nothing to worry about. A credit check is based on a lot of information, including the following:

• The electoral register, the area you live in and the value of your house;
• Any late payments you've made on credit cards, loans, utility bills etc;
• How many credit cards or loans you've been turned down for;
• Whether any County Court Judgements are recorded against you.

If you're worried that your credit rating may be poor, specify this in your uSwitch.com search and you'll be given a list of loans that are more likely to accept your application.

If your credit rating has been damaged, you might only be eligible for a more expensive loan. Specify that you have a bad credit rating in your search and choose between the loans offered.If you're not sure whether your credit rating has been damaged, you can contact the credit reference agencies for a report (for a small fee).

The uSwitch.com site is fully secure so any details you give to us are safe from fraud. Your information won't be passed on to any third parties. If you give information to a personal loan company this should also be protected, but it's worth looking on the company's site for details and checking their compliance with the Data Protection Act.

As a rule, internet-based personal loan companies do tend to offer lower APRs, usually because they have fewer overheads. This is not always the case, though, with high street banks competing fiercely with these new companies.

• Take out a personal loan and consolidate your debts (see below for details). This will simplify your finances and might cut your interest payments if you can find a cheap deal
• Ensure that you are on the electoral register at your current address, and that your address details with all your accounts match up
• Get a copy of your credit report and see what you can improve on
• Draw up a budget to figure out how much you can afford to pay back on your accounts each month. Stop spending more money on credit cards until you're in the clear
• Set up Direct Debits for card payments, loans, utility bills, council tax, TV licence, house insurance, gym membership and anything else you pay regularly. This will show that you're keeping payments up to date, but make sure you keep track of the money leaving your account

Debt consolidation is the term used for moving all your debts to one account. For instance, if you have two credit cards, an overdraft and a store card, adding up to a total debt of £8000, you could take out a loan of £8000 at a low APR, use it to pay off all of these debts, and then set up a Direct Debit from your current account to pay off the loan. You can then close all of your old accounts, or keep a credit card for emergencies. This simplifies your finances and will probably cut your interest payments.