Is your credit score in the red?
First of all, you’re not alone. About 30 percent of credit-active consumers in the United States have bad or poor credit.
Second, by now you certainly know the consequences of having a bad score. Qualifying for bank loans and credit cards at preferred rates becomes a big challenge and landlords can even turn down your rental application.
There’s good news, though. Did you know you can easily secure a personal loan with bad credit?
Here’s a quick guide on how to get approved!
Know Your Credit Score
The fact that you’re going in for a personal loan no credit check designed for people with bad credit doesn’t mean you’ll qualify automatically.
A potential lender might want to know how bad your bad credit score is in order to evaluate your credit risk and determine the amount of money you qualify for. If you don’t know your exact credit score, you could apply for more money that you qualify for, which might result in a rejection.
Plus, knowing your credit score can be the motivation you need to start taking credit repair steps. For instance, if your bad credit score is closer to good than it is to poor, making a couple of changes to your finances can be all you need to move out of the red zone.
The next step is to research and find lenders who offer installment loans for bad credit.
You can start by getting recommendations from friends and family. Another option is to conduct an online search. A simple “loans for bad credit lenders near me” is enough to reveal some of the top providers in your area.
Once you have got a list of about 3-5 personal loan lenders, conduct further research to identify your preferred lender. Look at lender reviews on Yelp, Facebook and other popular business review sites, customer testimonials, and loan terms and conditions.
Alternatively, you can use our service. We’ve tools that search through various lenders and help you find an affordable loan offer that suits your personal needs.
Choose Between a Secured and Unsecured Personal Loan for Bad Credit
There two types of personal loans for bad credit: secured and unsecured.
Secured loans require the borrower to put up collateral while unsecured loans rely on the borrower’s proven ability to repay the money.
Secured loans are ideal for people without a verifiable source of income but who own a valuable asset such as a car or house. On the other hand, unsecured loans are ideal for people who have a good source of income and maybe a little higher credit score. As secured loans are really made based on the value of the asset, these are real no credit check loans, where your credit check doesn’t matter to the lender.
Prepare Your Proof of Income/Collateral
After identifying the type of personal loan or payday loan online that suits your circumstances, it’s time to prepare the paperwork.
If you’re applying for an unsecured loan, you’ll need to provide your pay stubs or employment letter as proof of income. If you want a secured loan, decide on the collateral and prepare your proof of ownership.
You Can Get a Personal Loan with Bad Credit
Nobody willingly slumps into bad credit. However, bad or poor credit isn’t a life sentence. You can still get a bad credit personal loan. Even better, we’ve laid out all you need to do to get approved.
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