Getting a loan for any reason, such as buying a home or car, or even a loan in order to pay off some outstanding bills, like a credit card bill, can be difficult. Making the decision to get a loan is a big one because it means that you may have another bill added to your monthly budget for years at a time. However, loans can be extremely beneficial. You can pay off large bills, pay for tuition, and even get a home. Loans can help people achieve what they want, and give them a fair timeline in order to pay this loan back. It can be difficult to get a loan if you have bad credit. Bad credit could mean that you paid your bills late on more than one occasion, or that you have an outstanding balance on a credit card and you cannot get out of the cycle due to the interest rate. Most companies think that if you have a bad credit score, it is because you were irresponsible financially. This is not always the case. People can have bad credit because they have lost their job, or they had a large medical expense that was not planned for. Having bad credit does not always mean that the person is irresponsible, but no matter what the reason for bad credit is, you will have a more difficult time securing a loan. There are ways of getting a loan if you have bad credit, and if you follow these tips, you could be well on your way to securing a loan, even with bad credit.
If you are trying to get a loan from a bank, and you are having a difficult time because of your bad credit, you may want to try going to a credit union. These unions are smaller than the large banks, so they will be able to look at your situation on a much deeper and personal level. This means that they will take into consideration other factors of your life that may have produced your bad credit, or that prove that you can pay your bills on time.
There is also the option of getting a peer-to-peer loan. Instead of borrowing from a bank, you would be borrowing from an individual. You will post a loan listing that tells possible lenders the amount of money that you want and why you want it. The investors/lenders will look at the listings and choose the ones that meet their standards. The lenders can screen the applicants and check your credit. However, this is not anything to worry about. Your credit score is still a factor, but an individual lender may be more sympathetic to your situation if you have bad credit.
You can also borrow from your friends and family, if there are no loan agencies that will take you. Unlike with a peer-to-peer loan, you are borrowing from someone that you know, and not a stranger. Make sure that everything is documented, and that there are rules and headlines in place when borrowing from friends and family. Even though you are close, money can cause issues. If your friends and family are not able to or will not let you borrow money, you can always ask them to co-sign a loan. This means that they have a good credit score, and could lead to your loan application being approved because they show the credit scores that lenders want to prove a loan will be paid back.
There are many good lenders that have a reputation for helping people with bad credit. One of these places is called Avant, and helps people with credit scores between 600-700. They have a 9.95% APR, as well as a borrowing limit of $35,000, according to The Simple Dollar. Another great lending company is called Springleaf. Also from The Simple Dollar, Springleaf is said to help people who have credit scores under 600, and has more than 800 branches.
Although getting a loan with bad credit can be very difficult, there are many ways. If you need a loan for a car, home, or an unexpected bill, there are ways to get that loan if you have bad credit. It may take a bit more time and effort to secure the loan, but just remember that it is possible if you take the right steps.