Personal loans for poor credit
Around 35% of Americans who have any significant credit history at all have a credit score of “poor” or “bad,” which means that around one out of every three US adults has a patchy credit history that they may well be worried about.
And when an unexpected expense or financial emergency suddenly shows up, many with below average credit falsely assume that loans for poor credit applicants don’t exist, or at the least, that loans for people with poor credit can’t be on reasonable, affordable terms.
What Kinds of Loans for Poor Credit Are Available?
There are, of course, many lenders that will require “good,” if not perfect, credit scores before approving a loan – this is typically the case with many bank loans for a mortgage or a new car. But there is a whole other lending market of private online lenders who are much more willing to work with you despite some financial rough spots in your past.
Now, you can get federal student loans for poor credit, but that money goes to the educational institution and will never reach your hands. You can’t simply use it for your most pressing needs. And there are also car title poor credit loans, but those require you 100% own your automobile and then use it as collateral on your loan – which is risky business if that’s your only way to get to and from work.
The bottom line is that there are two major types of loans for people with poor credit: payday loans and personal installment loans.
Payday Poor Credit Loans
Poor credit loans often take the form of “payday loans,” which (more or less) have to repaid out of your next paycheck. Since few people get paid every week these days, that generally means you have either 2 weeks or 4 weeks to pay. And you can probably get a 4-week loan even if you actually get paid every other week.
Some payday lenders will use credit scores in determining rates, fees, maximum loan principal, and other loan terms. And some may run a credit check. BUT, many online payday lenders won’t even bother with such things. And there are hardly any payday lenders who are going to reject your loan application based on a bad credit score.
When is a payday loan best? In general, you can only take out from $100 to $1,000 on a payday loan. (The bigger your short term income, the more you can qualify for.) Since payday loans are very short, they have higher rates but not necessarily high interest and fees in actual dollar amount. If you only need a few hundred dollars for a short term expense and are sure you can repay in full within a month – payday loans make a lot of sense.
Personal Loans for Poor Credit
Personal loans for poor credit are the opposite of payday loans. With this type of loan, you get multiple months to repay the loan in regular installments. And you can borrow more too. Personal loans for poor credit are a longer term proposition. They have lower rates than payday loans and than many credit cards, and you can usually borrow as much as $5,000 (or even more.)
Personal loans aren’t based on your credit history but on your current ability to repay, meaning you need to show you have a reliable, verifiable source of income that will continue, in all likelihood, throughout the repayment period. As long as the lender thinks you will be able to repay the loan, you are almost sure to get approved for it.
With personal loans, there’s no collateral to worry about. The lenders will require that you set up automatic withdrawals from a US bank account scheduled on your loan installment due dates – but that’s it.
Now, you can take out small-sized personal loans of only a few hundred dollars instead of a payday loan. Which is the better deal will vary from lender to lender, offer to offer, and person to person. But usually, personal loans for bad credit are best when borrowing $1,000 or more.
Benefits of Fast Cash Loans for People With Poor Credit
Getting fast cash loans with poor credit, be it a payday or installment loan, is much easier than you probably realize. You can quickly locate a host of online loans for poor credit with a click of a button. The competition in this sector of the financial market is intense, and that means lower rates and more flexible terms can be found than would otherwise be possible.
But the most important benefits of fast cash loans are as follows:
- You can get the money in as little as one or two business days, deposited straight into your bank account.
- You don’t need any collateral to get the loan.
- You can use the money in any way you choose – no questions asked.
- The application process is simple and quick. You can apply in only a few minutes and get approved instantly.
- There’s no need to suffer rejection from bank after bank, endure embarrassment, and watch your credit score suffer from multiple hard credit checks.
- The payments and terms can be customized to your needs to make repayment affordable.
- By making all of your payments on time, you rebuild your credit.
If you can get a loan from a friend or relative, that might be better in some instances. But quite often, that’s not possible. Plus, you might not want to bother friends and family anyway or want to risk damaging a relationship by creating a lender-borrower relationship with a loved one.
For many people, a payday or personal loan may be the best available option. And if the right loan is selected and the loan is managed wisely, it could end up solving a financial crisis and improving the borrower’s credit score.
Criteria for Getting Loans With Poor Credit
Although your credit score is not used as an approval criterion for getting fast cash loans, in most instances, and the qualifications are very minimal, there are still a handful of “basic” eligibility rules that most lenders follow. And although these requirements vary from lender to lender, here are some of the most common ones you should expect to encounter:
- You are currently over the age of 18 and thus legally an adult in the US.
- You have an active US bank account, preferably a checking account. And you can arrange to have the loan money arrive into this account and the loan payments go out from it on auto-pay.
- You have a source of regularly recurring income that can be verified by the lender.
- Your income stream is high enough that you can afford to make all payments on time. This means not more than 20% of your monthly income, as a rule of thumb, should go to the loan payments.
- There is not another loan you still have outstanding from the same lender.
- You didn’t fail to repay a past loan to the same lender or to another fast cash lender anytime in recent years.
As you can see, the eligibility rules for these types of loans are very basic. You only need to provide basic, relevant personal and financial information on the application form and push a button – within seconds, you are likely going to see “approved!”
How to Find Online Loans for Poor Credit
Bonsai Finance has been a leader in the fast cash loan industry for many years. But we are not lenders. We help you locate, evaluate, and apply for loan offers from top lenders. We are not tied to any particular company offering loans but are free to assist our customers in finding whichever loan is most appropriate to their needs.
We have deep experience in helping people find online loans for poor credit and in sifting through their many options until they have found the absolute best one. Want to know how to get loans with poor credit? Wonder how each loan type works? Need some helpful advice on which loan offer might best serve your needs? Our staff stands ready to assist you!
Our search engines have access to a vast database that enables you to enter every conceivable search criteria and narrow the field to the loans that best suit you. Anyone trying to research one website at a time, or even visit a lender review site, isn’t going to get access to the volume of reputable lenders and valid loan offers that our search engines give you access to.
If you are looking for loans for poor credit applicants, we can rapidly locate the best offers. We can also provide one-on-one assistance from on-staff industry experts.
No one really has time to sit around for hours on end researching a handful of offers. And who wants to make a decision based on just a few offers you happened to stumble across – that’s a hit and miss approach that relies on luck. Our approach is comprehensive, streamlined, and proven effective.