It is very likely that you have seen a sign somewhere or a message on your TV saying, “no credit; no problem!” What does that even imply? For all we know, trying to get a loan when you have bad credit or no credit is definitely a problem. Don’t be in a rush to fall for the flashy ads that promise to solve your problems in a minute; this is the time to be cautious and evaluate your options carefully.
However, having a poor credit score certainly does not make it impossible to get a loan, whether for certain medical emergencies, car or home repairs, or even to purchase groceries. Please carefully research the loans that are available for you; here are a few of the best options available for people with bad credit.
Bad Credit Loans
Desperate circumstances call for desperate measures, and for people with bad credit, this might be the only option available. Most bad credit loans types, such as payday loans and pawn shop loans have incredibly high rates of interest, so we advise that you think carefully before deciding to go down this road. Also, avoid getting caught up in a continuing loop of debt by any means possible. The good thing about bad credit loans is exactly what the term implies – people having even very low credit scores can apply.
Credit Union Loans
It is far easier to obtain a loan from a credit union in comparison to a bank because their credit standards happen to be more relaxed. Some credit unions accept membership from almost anyone, provided they are residing in a particular location or pursue a specific profession. Since credit unions are non-profit entities, they can offer a variety of financial services at cheaper rates than profit-driven banks.
Auto Title Loans
Title loans are a type of secured loans that let borrowers use their car, truck, or motorcycle title as security for the loan. These loans short-term, and can carry higher rates of interest than other sources of credit. This is a good option for those with bad credit because lenders typically do not check the borrower’s credit history and only considers the condition and overall value of the vehicle. In most cases an auto title loan can be acquired in as little as 15 to 30 minutes on loan amounts as small as $100.
This is a rather new type of borrowing method, but equally reliable nonetheless. peer-to-peer loans are typically by individual lenders rather than from large financial institutions. Interest rate tends to be lower than what is charged by credit cards, and your loan will also have less fees.
Personal Loans for Bad Credit
Personal loan lenders usually work online and offer loans at competitive rates for things like home repairs and credit card debt consolidation. This is a relatively new industry whose primary appeal is to expedite the process and have the loan sanctioned in a matter of few hours. The factors personal loan lenders take into consideration may include your college degree, employment history, current profession, etc.
If you are currently employed or have a steady income that is the primary thing for being able to afford a loan. You may be eligible to be approved for bad credit personal loans and similar type programs. The rate of interest will be higher but it is a great way to start rebuilding your credit.
Explore Your Finance Options if You Have Poor Credit
As you can understand, having bad credit is not the end of the world. You still have many loan options available, among which the above-mentioned options are only five. So, put your chin up and explore which of these should work best for you.