There are various reasons why a personal loan may be needed. For example, excessive credit card debt or home improvement needs may demand required funds. However, in these tough economic times, there is a challenge in meeting the credit requirements for obtaining a personal loan.
In this article we will discuss various loan options for those with less than perfect credit. In addition, we will look at options to improve your credit so you can have more options open to you.
Consider Borrowing Choices
For those having poor credit, there is a need to consider borrowing choices. Reviewing and comparing various options will help you to make an informed choice. It is most important to not allow desperation to cause you to make an expensive or poor decision. Select the right personal loan for your personal requirements. Moreover, contemplate the amount of cash you need to borrow as well as the time for waiting.
Poor Credit Loans
Happily, there are options, although limited, for clients who have less than perfect credit. There are lenders that cater to low credit score individuals. However, you will no doubt be hit with higher fees than normal. Other factors to be considered are the amount of loan, the terms of payment, pay-off penalty if any and the minimum credit score required.
Following are some of the options available for those with poor credit to consider when in need of a personal loan:
Loans Under 36%–On this website, you will be able to review loans from many different lenders. You may qualify for a loan with a credit score as low as 300. The interest rate will vary from 5.99% to 35.99%. Fees and interest will depend on the lender and your credit worthiness. You may borrow up to $35,000.
2. AM One–With this website, you will be matched with a loan specialist based on your needs and your profile. They will do the loan search for you and you will receive terms and fees from the lender. Your credit score can be as low as 300. Interest rates range from 3.49%-35.99%. Loan amounts can go as high as $50,000.
3. Lending Tree–We have no doubt all heard of Lending Tree. They are one of the largest lending platforms available online. As with the others, you can be approved with a credit score of only 300. Interest will range from 3.99%-35.99%. You can borrow up to $50,000.
4. 5K Funds–This is another platform that allows you to compare loans from various lenders. The lenders are of good repute. You can borrow up to $35,000 and as with the others, your credit score need only be 300. Their interest rates will range from 5.99%-35.99%.
5. One Main Financial–Another platform that is popular in this market. Interest rates are a bit higher ranging from 18.99%-35.99%. However, if you are in a position to pay off the loan early there is no fee involved. The life of the loan can be from 24 months to 60 months which is not as long as other lenders allow for. They will allow you to borrow up to $20,000. The amount of the loan should be available to you in only an hour after final documents are signed.
Other Options May Be Available
Depending on your needs, there may be other options available to you. A traditional personal loan with a co-signer may be helpful. If you have a close friend or relative with good credit, they may be willing to help you out by co-signing. This may very well get you better terms and lower interest rates.
Credit Union Loans
Being a member of a credit union has certain advantages. In most cases, credit unions have lower interest rates than other types of lenders. They may also be easier to work with than a traditional bank. If your credit is not perfect, there are several options open to you. If you simply need some quick cash to see you to the next payday, they offer a payday loan.
Credit unions also offer credit builder loans. If you are in good standing as a member, they may work with you on a loan. This will go a long way to building your credit rating for more options in the future.
Home Equity Loans
If you own a home and have equity, you may want to think about tapping your home equity. In spite of lacking a credit score with equity, you may be able to borrow the money.
More Things To Think About
Further, you can make use of other options such as payroll advances, borrowing against life insurance, or mortgages from retirement accounts. However, these are the last lines of defense when it comes to money borrowing . Typically, it is done in case all the other methods have failed. If you are not in need of emergency funds, there is an advantage in working on raising your credit before applying for a personal loan. Ensure that you repay your debts on time especially on credit cards. Also, minimize the account balance on the card to under thirty percent of the credit maximum permitted. These factors account for about seventy-five percent of your credit score.
Advantages of a Poor Credit Loan
There are, however advantages to a poor credit personal loan. First, they are quick and applications are available on the internet on the above mentioned platforms. The response time is usually very short and it may be only a few days before receiving your funds. Next, there are a number of lenders to choose from. The terms of repayment can extend up to five years making for a lower payment. Lastly, and most important, timely payments on a personal loan will increase your credit score. The next time you need a personal loan, your options will be wide open to you.
While there are a plethora of credit card offers available to individuals with any credit circumstance. Our extensive team of credit card pros take the time to research and dig deep in each credit card offers. Whether you have good credit, bad credit, no credit, looking for lower rates or saving money. We know offers are worth showing to you.