Can I Take Out a Payday Loan With Someone Else’s Name?

No, you cannot apply for a payday loan using someone else’s name because this is considered fraud and is illegal. The only way that you can apply for a loan using someone else’s name is if you have their full permission, consent and are in their presence.

A lender will run thousands of automated checks during the application process and will quickly be able to flag any discrepancies and your loan will be declined.

People who apply for payday loans or £500 loans may be looking for a fast way to borrow money for an emergency. If they have been declined, they might consider applying with someone else’s name like a parent, sibling or spouse to try to get approved. However, this is illegal and will likely be discovered by the lender immediately through their checks.

In certain cases, you can help someone apply for a loan, for instance if they are disabled or visually impaired, but the loan must still be in their name and you must have their consent.

Applying For a Loan in Someone Else’s Name Can Lead To Prosecution

A lender is required to report any suspicious activity to the regulator and actively trying to borrow money in someone else’s name, without their knowledge, can lead to the following under The Fraud Act of 2006:

• Arrest
• Criminal charges
• A criminal record

If the loan is approved, that individual’s name will be responsible for the repayment of the loan and any impact to their credit score. This is illegal and harmful to the victim.

Can Lenders Tell If You Apply For a Loan Using Someone Else’s Name?

Yes, a lender can tell very quickly if you are applying for a loan using someone else’s name. A payday lender will carry up to 8,000 automated checks during the underwriting and application process, which includes credit checking, identity checking and anti-money laundering checks. 

A lender can very quickly flag anything that doesn’t look right including:

• The name doesn’t match the email address
• The name doesn’t match the bank account name
• Someone using the same mobile phone number recently applied
• Someone from the same IP address has recently applied
• The credit check shows an association with a recent applicant or someone with poor credit

Lender Will Ask For Supplementary Information

Today, responsible lenders will ask for additional information to show proof of address, income, employment and bank account. The documents will need to be legitimate and lenders will be able to tell if they are not.

When Can You Apply For a Loan Using Someone Else’s Name?

There are circumstances where it is accepted to apply for a loan using someone else’s name, but only with their permission including:

• Those with disabilities – visual or physical
• If you are a legal guardian and the individual is under 18
• If you have power of attorney (PoA)
• Joint applications (with their consent) such as for a business, joint account or guarantor loan

What Are Your Options If You Need Help From Someone To Borrow Money?

If you have struggled to access mainstream finance or loans for bad credit, you can get help from other friends and family members. Borrowing directly from trusted family and friends is the most safest option and is usually interest-free. 

There are other options available including loans that include a guarantor to co-sign the loan agreement (such as a parent, sibling or spouse). You can also visit a local credit union, which serves their local community and are willing to consider people with no credit history or financial background.

Finally, if you are experiencing financial issues, you can speak to a debt professional for free through The Citizen’s Advice Bureau or debt charity, StepChange.