Your loan options can be limited if you have had financial problems in the past and you need to get a loan now. If you have a bad credit status, the regular loans from the banks you request will only be available at a high interest rate. You may not be eligible for a traditional bank loan if your credit rating is very bad. Fortunately, there are many options available to you although some of them may pose considerable risk, such as using your personal assets as collateral. Before considering the possibility of following any of these loan options, think about what you have led to a bad credit and if your situation has so bad now that it has a good ability to repay the borrowed money. Obviously, you should avoid anything that will further your financial and credit situation. Investigate the Internet to find a site that gives advice and help you understand your options, as well as determine the best way (whether the demand for a loan is viable or not).
Application for a loan to a friend or family member
1. Find someone to borrow money.
Perhaps your best option is to borrow money from a friend or family member if you are willing to do so because it is someone who can do without hesitation or with a better course.
2. Agree with the terms.
Make an agreement with your friend or family member about how much they are willing to lend you and their payment expectations, including possible interest.
To avoid damaging your relationship through this transaction, you must be honest with the creditor about your circumstances and the time you expect to repay the money.
3. Put it in writing.
It is advisable to make your agreement in writing. In this way there will be no conflict, what were the terms of the agreement.
The borrower can ask you to sign a promissory note and present it to a notary to strengthen his legality.
Treat the terms of a loan as seriously as you would with a bank.
4 Ask to sign a loan.
If you need to borrow more if your friend or family member is at hand or is willing to lend you, consider asking them to sign a bank loan with you.
You can get a better rate if the person you asked to sign the loan with you has a better credit status than you.
Keep in mind that if you are late with loan payments, your child’s or family’s credit rating will be greatly affected. Don’t ask for a loan under the name of someone you can’t pay.
In this case, the specific rate may vary depending on your family member’s credit rating. Review an online loan repayment calculator to determine the payments and dates you need to make.
Get a loan from a credit union
1. Find a credit union in place.
Credit unions are small, local banks, and they have members, rather than shareholders.
Due to their business model, credit unions tend to have lower rates and another model of customer service that assess loan applications on the basis of other aspects, rather than credit ratings.
If your credit rating is bad, the rate will be high, but not as high as it would be in a large bank.
2. Open an account Because the owners of credit unions are members, you must become a member and be eligible for a loan.
Opening an account in a credit union is the same as opening one in a bank. Bring cash and a banker’s identity document to help you set up a savings or control account.
3. Request a loan Talk to a banker at the credit union about your eligibility for a loan and complete the necessary paperwork.
Because of the more personal treatment of credit unions, the banker you are talking to will take your own circumstances into account when applying for a loan. It is possible for a credit union to approve a loan, even if a large bank denies it.
However, you should not expect to receive a loan under the same terms as you would if your credit status were good. A poor credit status means that the funds you receive will be granted with a high interest rate. This is because the bank risks more with your loan than with someone who has a better credit rating.
In this case, the specific rate may vary depending on the loan offered by the credit union. Review an online loan repayment calculator to determine the payments and dates you need to make.
Get a loan between individuals or a personal loan without warranty
1 Visit a loan website between individuals.
Since 2005, several companies have emerged that allow borrowers to communicate directly with borrowers. The potential benefit of this is that the borrower usually gets a better rate and is more likely to get a loan, even with bad credit status – while a creditor pays better for his money compared to what is usually achieved. in a bank.
Explore the Internet to find certain web pages that provide this service in your country.
Another option is to visit web pages that are specialized in buying debt.
These web pages allow you to enter the amount you expect to get, your reason to ask and your credit statement general and will tell you based on this information if a loan is available for you to promote in the estimated interest rate, which varies between 5.9% and 36% or more depending on your situation.
The following is a general description of the general process of applying for a loan through one of these pages. The steps you take may vary depending on the type of loan you are looking for and the loan site.
2. Create an Account When you have decided to apply for a particular loan, you need to create an account and provide your personal information to have a credit overview.
3. Request a loan If you have created your account, you can actually request a loan, specify what it is for, how much you need, and so on.
It is your opportunity to make yourself attractive to potential borrowers. The information you can include will be seen as a safer investment. You can comment on a story about whether you paid your debt or comment on your innovative business plans, for which you will use the money you borrowed.
4. Waiting for an offer. In this phase you will have to wait for a creditor who believes that you are a good investment to make you an offer. You can get an offer for the total amount you requested, or you can combine several small loans.
As with a financial institution loan, you should expect the terms and conditions of the offer you receive from a home loan website to be less favorable than you would be if your credit rating were good.
For example, many of these institutions offer information such as “5.5%” or other promises. The reality is that many of the annual rates for loans vary between 12 and 16%, while in loans more risks are at 36%.
Specifically, a customary duty for one of these services may be 15% interest plus a 1% opening commission. Therefore, if you applied for a $ 10,000 loan under these conditions and you have to repay it within two years with $ 500 monthly payments, you will eventually pay 1,715.56 in commission and interest. It represents almost one fifth of the original amount borrowed.
5. Make an agreement. When you lured a creditor or creditors, you will make an agreement with them and your funds will receive you.
Normally, the website will monitor the status of the loan if you pay it and will be responsible for billing.
Note that some sites may charge an opening commission. Make sure you review the terms of service before applying for a loan.
Get a guaranteed loan. Get a home loan. Another option is a secure loan in which a property you own is used as security. A mortgage loan is the one obtained according to the value of your home.
Get a cash advance, a quick loan or a repayment loan. Find out if you have any other option. The following options can be extremely expensive or risky. Most experts regard them as abusive and do not recommend them. Here you will find information about them to get a better understanding of their operation as well as the risks involved. Think carefully before considering any of them and talking to an advisor before choosing one.
Get a pre-paid loan. You can get a loan based on your early repayment if you were not successful with the other methods and expect a refund of your income tax. Contact a large tax preparation company for a prepayment loan. Banks no longer offer these loans.