Divorce, a major illness or a career crisis can turn a good reputation into a bad one in a short time. A poor reputation is a position that no one wants to actively obtain. But sometimes it is the best we have. This can be the result of purely poor financial management, but it can also very well be the result of a difficult life. Getting a loan may seem impossible with poor credit, but you can do it if you make sure you pay it back on time and on a monthly basis.
There are five levels of credit – excellent, very good, good, fair and very poor. One of the three major credit bureaus, Experian, considers bad credit to be a credit score of less than 580. Unlike good and fair credit, there is little wiggle room for bad credit. 580 is not only a strong cut-off line, some lenders even place loans with scores between 581 and 620 in the lower category.
Loan aggregators are not direct lenders, but rather platforms with a large number of lenders involved. Because they can meet all credit ratings, you can get a loan from a loan aggregator even with bad credit. To apply for a loan through a loan aggregator, the borrower must fill out a loan application and then the lender will make an offer based on the borrower’s creditworthiness. monevo is a good option. monevo allows you to compare an application with up to 30 lenders in a matter of seconds. Loans range from $500 to $100,000 and APRs start at 2.49%. Monevo will check your credit score, but some of its lenders will accept credit scores as low as 450.
Another is Fiona, where you can complete a loan request and get dozens of quotes from different lenders, all organised in an easy-to-read list. Best of all, our credit score is not affected until you select a lender and complete their application.
Another option is to originate a personal loan with a lender that has flexible credit score requirements.OppLoans does not require a minimum credit score, but takes a variety of factors into account. This includes bank data and information from alternate credit reporting agencies. Most importantly, OppLoans reports your payment history to the three major credit bureaus to help you improve your score.
OneMain offers loans from $1,500 to $20,000, so you can view your offers without affecting your credit score. The process is somewhat rigorous, but OneMain has been operating for over 100 years and it’s safe to say they know what they’re doing. After filling out the application form, you will meet with a loan specialist at your local branch where your identity, income, expenses and employment will be verified. From there, you’ll sign some paperwork and use your money! Avant offers personal loans from $2,000 to $35,000. Interest rates range from 9.95% to 35.99% depending on your credit score. The online application process is simple for lenders, with a clear and transparent process and quick financing features. If your application is approved, you can receive the funds within one working day.
Payday loans are specifically designed for people with a bad reputation. Basically, they will advance your next paycheck. The interest rate can be over 300% and they will need access to your bank account to withdraw the funds on your next payment. The worst thing about payday loans is that when you get one loan, you’re practically doomed to get another – and another …… Most people who use payday loans get stuck in a cycle until they default on their debt. When this happens, payday loan companies can be particularly annoying competitors.
Bad credit prevents you from accessing mainstream lending sources, forces you to look for loans in unlikely places and leaves you having to pay high interest rates under very strict conditions. You should get out of this situation as soon as possible. In fact, if you have poor credit, the best lending strategy is to improve your credit standing before applying for your next loan.