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).