How do Doorstep Loans Work?

If you need to borrow money, there are many different options available to you. From bank loans, to credit cards, payday loans to guarantor loans, the choice can be overwhelming.

One of the oldest forms of consumer credit is doorstep lending. But how does it work and what are the benefits?

Doorstep loans (also known as Home Collected Credit) have been around for many years and used by over a million people in the UK.

Doorstep loans are, as the name suggests, loans of all sizes, from smaller amounts of money up to £5000 with Cockle Finance, that are brought to you at your home by an agent of the company you borrow the money from.

When you initially apply, you’ll have an agent visit you in your home to take your details and discuss the loan with you. Their office will then decide as to whether you are accepted for the loan.

If you are accepted, then the agent will bring the loan back (often in cash) to your home.

Making repayments on a doorstep loan are traditionally made by an agent collecting cash on a weekly, fortnightly or monthly basis from your home. Many companies will ow accept debit card payments, but all doorstep lenders will still offer the home collected service.

What are the benefits of a Doorstep Loan?

There certainly are many benefits to having a doorstep loan. One of the biggest things that attract people to them are that there are no late or missed payment fees. This means that if one week you are unable to make your repayment, you know that your lender won’t add on anything to your balance for missing that payment (be warned, missing payments will still affect your credit rating with the company).

Another great benefit taking out a doorstep loan in that you will be assigned an agent, who you can talk to at any point in life of the loan. We all know how annoying it is when you need to speak to a company and all you get is automated messages or you’re asked to message in. With a doorstep loan you’ll have an agent that will come to visit you in your home to discuss anything you need to about the loan.

If you haven’t got the greatest credit score in the world, then you may find it hard to get a loan from many lenders. The great thing about doorstep loans is that many lenders will take you on, even if your credit isn’t in the best shape. There are quite a few lenders that don’t do a credit check on their customers but instead, go on the information that the agent takes when discussing the application initially. This means that you could get access to credit, without a great credit score.

Dan Cockle is the Managing Director of Cockle Finance and current Vice Chairman of the Consumer Credit Association. He has over 15 years’ experience in Financial Services with a passion for Finance, and particularly Fintech. He was shortlisted for Business Leader of the Year in the Alternative/Consumer Finance category of the 2023 Credit Strategy Leadership Awards. Outside of work Dan enjoys cooking and is a keen golfer.

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