What if you qualified for a loan you desperately needed and didn’t know it?
Many people who have poor credit think that it’s impossible to get a loan. However, you may qualify for bad credit loans and not know how to recognize the signs.
Wonder if you might qualify? Keep reading to discover the eight signs that you qualify for bad credit loans!
1. What’s the Score?
We’ve put together a solid list of signs that you might be able to qualify for bad credit loans. Our first sign is the most obvious: your credit score.
Your actual credit score ranges from 300 to 850. Many people think they have a “bad” credit score, but they don’t know what the actual number is.
It’s free and easy to sign up for credit monitoring services that will provide you with an accurate score each month. If you have a credit score of at least 579, then you are likely able to get a loan.
2. You’re (Re)Building Credit
Remember when we mentioned signing up for a credit monitoring service? That will come into handy for this next part.
Another great sign that you may qualify for bad credit loans is that you are taking steps to improve your credit score. However, you will need a monitoring service to know if (and when) any changes have occurred.
Paying down debts, for instance, can improve your debt to credit ratio and boost your credit. If you’ve been taking proactive steps towards repairing your credit, then you may be able to qualify for the loans you need!
3. You Have a Cosigner
When people think of getting a loan, they usually think of getting a personal loan. And, of course, they think about getting that loan only in their own name.
However, it’s possible to get a loan with a cosigner. As the term implies, a cosigner will be equally responsible for making sure that the loan is paid off in a timely manner.
This is a big responsibility, and not everyone is happy to do it. But if you have friends or family in your life that are willing, then you may need to swallow your pride and simply ask for their help.
4. You’ve Cleared Up Your Report
There are many good reasons to sign up for regular updates about your credit. And one of the biggest reasons is that you now have a chance to set the record straight.
Credit monitoring agencies typically gather and report info from the three major credit bureaus. This gives you a starting point to look into anything in your record that may be dragging your credit down.
For instance, a credit bureau may still think you have an outstanding debt that you’ve already paid off. By reporting this issue to the appropriate credit bureau, you can get a boost to your credit score that may help you qualify for a bad credit loan.
5. You Have Collateral
If you have bad credit, then you may have difficulty qualifying for an unsecured personal loan. However, it may still be possible to get a secured loan.
A secured loan means that you offer up some form of collateral to the bank in order to secure the loan. One example of this is using your personal vehicle as collateral.
Of course, the bank actually gets ownership of what you put up as collateral if you are unable to pay the loan back. That makes it particularly important to pay secured loans back to the bank in a timely manner!
6. You Have a Credit Union
Oftentimes, people don’t understand the difference between a bank and a credit union. However, if you need to qualify for bad credit loans, then being part of a credit union may make all the difference.
Unlike traditional banks, credit unions are typically formed and maintained by their community. And this means that they are likelier to value relationships over things like credit scores.
What does this mean for you? If you have had a good relationship with your credit union for many years, then they may be able to approve a loan that other financial institutions would be unable to approve.
7. You Have Steady Work
While it’s likelier with a credit union, both the union and the bank may decide to weigh factors other than the credit score. If this is the case, then you may be in luck if you have a steady job.
Obviously, a big factor to a lending institution is whether you can pay the loan back or not. However, it’s possible to have a steady job and still have poor credit.
If you have a good and stable job, be sure to bring that up with the lending institution. This may be enough for them to approve loans for bad credit.
And if things don’t work with the traditional lending institutions or credit unions, you can always pursue a payday loan through a specialty lender. For these types of loans, simply having the job gives you all the credit you need!
8. You’re Online-Savvy
If you consider yourself internet-savvy, then you may be able to get a different kind of loan. Specifically, you may be able to get a peer-to-peer loan.
These modern kinds of loans bypass the traditional lenders and credit unions entirely. Instead, you get the money you need from an individual or group online and then pay that loan back with interest.
The obvious benefit of this kind of loan is that the decision is entirely in the hands of the person lending the money. That means you can appeal to them with a variety of factors and not simply your credit score.
Bad Credit Loans: The Bottom Line
Now you’ve learned more about bad credit loans and the signs that you may qualify for one. But do you know which lender might be able to help you get started?
At Bonsai Finance, we are the ultimate authority for any kind of loan you might need. To see how we can help with bad credit loans, come apply for one today!