Traditional lenders often shun borrowers with poor credit. That means that unless you have a strong income and a high credit score, you probably won’t be approved for a loan from the bank.
So what should you do if need cash and have a less than perfect credit score?
A slew of bad-credit lenders has popped up online. OppLoans is a popular service geared toward people who mainstream lenders overlook.
The platform gives struggling people a chance to rebuild their finances without having to resort to using a cash advance. OppLoans offers its borrowers far more attractive rates than those seen in a typical payday loan.
However, the company isn’t perfect. This post will explain the advantages and disadvantages of obtaining a loan through OppLoans.
Let’s get started.
What Are OppLoans?
OppLoans the online leg of Opportunity Financial, a Chicago lending company.
Their interest rates are steep compared to other personal loan companies, but OppLoans is targeting a specific customer. A lot of their borrowers don’t have a lot of options. OppsLoans’ terms are wildly attractive compared to those offered with most payday loans.
What Is an Opportunity Loan?
An opportunity loan is designed for borrowers who normally wouldn’t be approved for a loan. Most lenders require that their customers have a decent credit score.
People with bankruptcies or missed payments in their pasts would be denied a loan. This would push them into payday advance companies where they settled for painfully high-interest rates and a short repayment schedule.
OppLoans offers opportunity loans. They’re similar to payday loans in that they’re a reasonable option for borrowers with bad credit. The difference, however, is that you get more time to repay an opportunity loan.
You can use the money to pay for anything that you want. It could go toward covering surprise medical expenses or paying off your credit cards.
Who Qualifies for a Loan?
You need to meet a few basic criteria to successfully work with OppLoans.
There’s no minimum credit score required to be an applicant, but you will need to have a job. You’ll also need to make a certain amount of money per month. In most states, the amount is $1,500.
You should be at least 18 years old and not currently be serving in the military. When you apply for your loan, you’ll need to enter your bank account details. You must be paid via direct deposit to be approved.
How Much Will Your Loan Cost?
The company offers interest rates ranging from 36.00% to 199.00%. The rates are very expensive compared to those offered by more established lenders.
Someone with good credit should be able to get a personal loan with an interest rate of 5.5% to 9.3%.
OppLoans asks for higher interest payments because they approve riskier borrowers.
Your interest rate will depend on what state you live in, your credit history, and how much money you’re asking for.
Pros and Cons
OppLoans is an extremely attractive option for borrowers with a poor credit score or a nonexistent credit history. The company offers loans that are rarely available to people with an unusual financial history.
Here are some of the benefits.
There are a lot of reasons why a borrower might consider using OppLoans.
1. If you need to, you can borrow a lot of money. Depending on your state, you may be approved for up to $10,000.
2. You can rebuild your credit. Your loan repayments will be reported to the three major credit bureaus. If you make enough on-time payments, you might be able to improve your credit score.
3. You can receive funds quickly. The signup process is quick and easy. You should have a loan decision within minutes.
4. There’s no minimum credit score.
Here are some of the drawbacks.
The platform isn’t ideal, however.
1. The service only exists in some states. OppLoans doesn’t operate in nearly half of the states in the U.S.
2. Residents in some states have to pay extra fees. California borrowers, for instance, are required to pay a $75 administrative fee.
3. The interests rates are high. The rates are more reasonable than those offered by payday lenders, but they’re still expensive.
Being a poor credit borrower can be tough. Nobody wants to accept steep interest rates, but sometimes you really need cash.
If you have to borrow money before you can fix your credit, an opportunity loan could be an excellent option.
How Is OppLoans Different from Payday Lenders?
Opploans is still making a name for itself in the lending world. Opportunity loans aren’t available in most states, which is why most people haven’t heard of them.
The company isn’t quite a peer-to-peer lender, but that works to its advantage. OppLoans is less strict about its applicants’ credit history than its competitors. You can apply for a loan and see your terms without your credit score being affected.
OppLoans also isn’t a payday lender. Opportunity loans are much better for borrowers than payday advances. The interest rate is significantly lower and the repayment schedule is much more generous.
People with a credit score above 680 can likely find a loan with more reasonable terms than those offered by OppLoans. People with a lower score, however, would be smart to consider an opportunity loan before turning to a payday advance.
Find out More
OppLoans isn’t a perfect option. The interest rates are high and the repayment period is shorter than average. Borrowers with a strong credit score can likely find a better deal with another company.
However, there are a lot of advantages to working with Opploans. The company is willing to lend money to borrowers who would never be approved by traditional lenders.
Obtaining a loan isn’t your only option when you’re trying to rebuild your credit. If you don’t have a pressing need for cash, there are other things that you can do. For example, you can apply for a secured credit card.
We can help you navigate your financial options. Take a look at our learning center for tips on improving your credit.