When you have a credit score 300-629 you are regarded by most lenders as someone with bad credit, although your credit score may keep you from getting a great APR it is possible to get a loan with bad credit.
I am going to explain how to get a loan with bad credit in this article and help you get interest rates that are lower than those you could find for payday loans.
What is a loan for bad credit?
There are two types of personal loans that you can get with bad credit, these are unsecured loans which does not need collateral. Instead, lenders will consider your credit score, credit report and debt-to-income ratio. If you have a poor credit score which may range between 300-629 on the FICO scale it doesn’t automatically disqualify you from getting an unsecured personal loan, but this lowers your chances of being approved. If you do get approved, you may get an interest rate at the high end of a lender’s range.
Secured personal loans will require you to have collateral which may be in the form of a home or a car. These are much easier than unsecured personal loans to get approved for if you have bad credit.
When you borrow money through a bad credit loan you will repay it in monthly installments, This will be over a period of one year to five years. These funds can be used for almost anything, whether you need to cover a pressing expense or consolidate your debt.
If You Have Bad Credit Where Do You Find A Loan?
If you are looking for a bad credit loan some of the best places to look at are Some of the best places to look are online lenders, as well as banks or credit unions. These lenders are most likely to have competitive rates and reasonable fees. You however need expect to pay high interest rates because of your bad credit.
If a lender who guarantees that everybody gets approved be careful from borrowing from such a lender. This may be a scam, and you’ll end up in a worse place than you started. Take note that payday loan shops tend to lend money at extremely high rates, so it’s best to stick to the lenders I highlighted above.