We aim to make our website as accessible as possible. However if you use a screen reader and require debt advice you may find it easier to phone us instead. Our phone number is 0 8 0 0 1 3 8 1 1 1 1. Freephone (including all mobiles).
StepChange Debt Charity logo

Free advice on problem debt
based on what's best for you

Request a call back »
Or call us on 0800 138 1111Mon-Fri 8am-8pm, Sat 8am-4pm

Doorstep loan debts

Doorstep loans or home-collected loans have been with us for generations. Chances are your grandparents or great-grandparents would have been familiar with doorstep loans, and may even have borrowed money from companies that are still around today.

When you take out a doorstep loan a local agent will give you a cash, or sometimes vouchers. They’ll then call round to your house to collect payments, usually once a week. You’ll normally get a payment book to record the payments that you’ve made.

Some larger doorstep loan companies such as Provident, Greenwoods, Morses Club or Shopacheck operate across the country. There are also lots of smaller regional doorstep lenders.

Doorstep loan costs

Doorstep loans are a very expensive way to borrow money so you should think carefully before taking one out.

The rate of interest or APR on a doorstep loan is usually 200% or more, and they’re normally paid weekly back over 6 to 9 months. As a rough guide, you can probably expect to pay back £150 to £180 for every £100 you borrow.

This APR is lower than a typical payday loan, but because doorstep loans are paid back over a longer time the total amount you’ll pay can be similar. 

If you’re considering a doorstep loan, you can find out more about the costs at the independent Lenders Compared website. This lets you compare how much each doorstep lender in your area charges so you can find the cheapest.

Struggling with doorstep loan debt?

Get expert debt advice & a personalised debt solution

FREE online debt advice   20 mins

Try Debt Remedy

Doorstep loan alternatives

If you’re thinking about taking out a doorstep loan, consider these cheaper options instead:

  • Try your local credit union. They issue small loans paid back over a similar time to doorstep lenders. But interest on credit union loans is capped at a much lower 42.6% APR. Find your credit union can put you in touch with your local branch
  • If you’re on benefits and you have an emergency expense, you may be able to get a budgeting loan. Contact Jobcentre Plus to see if you qualify
  • Many local authorities offer help to people in emergencies. This may include cash loans or food vouchers. What’s available varies a lot from area to area, so contact your own local authority to check if they can help

Doorstep loan arrears

If you miss payments to your doorstep loan the agent will ask you to catch up. There may be extra charges added if you miss payments, although some doorstep lenders don’t add any.

Sometimes you may know the agent personally. This can make it harder to explain if you can’t pay. But remember that your doorstep loan is the same as any other debt, and they don’t have any extra legal powers. The agent isn’t a bailiff, and they can’t come into your house or take anything from you. They can’t force you to pay money you don’t have.

If you don’t pay back the arrears, you’ll get a default notice. By this stage, larger doorstep loan companies will usually deal with your loan from their head office and you may find the agent stops calling. This can make it easier to deal with the debt.

After the default notice, the doorstep lender can then take further action. For more information on what action a doorstep lender can take to collect a debt, see our what your creditors can do section.

Doorstep loans and loan sharks

Some illegal lenders or loan sharks operate in a similar way to legitimate doorstep lenders. For example, they may call at your home and record your loan in a payment book.

If you think your doorstep lender may be a loan shark, get specialist advice before you consider stopping your payments.

Doorstep loan help

Taking out expensive types of credit like doorstep loans can be a warning sign that you have a debt problem.

If you’re considering taking out a doorstep loan, or if you’re struggling to pay a doorstep loan, we can give you free and impartial debt advice.

Use our online Debt Remedy tool, or call our Helpline on 0800 138 1111 (Free from all landlines and mobiles).

Helping you become debt free...

“I wish to thank your staff for all the great help they gave me when I was in so much debt.
They were a pillar of support to me.” (Leslie, Essex)

Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

*This is the average rating of our service on Feefo by DMP and DRO clients three months into their solution.

© StepChange Debt Charity 2016