Personal loans for people with bad credit have become a light of hope shining for many of those who do not have the means to get a regular loan. Or in other words, they do have the means but they do not qualify. These loans can be either secured or unsecured, no-credit check is often possible, and up to $ 10,000 can be obtained. Certainly appealing, would you not say?
Yes, everything seems perfect, but at what cost? You must be wondering whether this can really be true. The answer comes to you in the form of this article. We will explain bad credit loans in further detail and let you know what it is needed in terms of requirements for qualification.
Where To Look?
There are many financial institutions offering this type of personal loans. The best way to perform a search is surfing the net. Internet is plagued with bad credit lenders, you will be able to conduct comparisons and ask for free loan quotes (when available). Remember, the golden rule of bad credit lending is: if there is an upfront fee, refrain. As you might very well know, there are many unscrupulous lenders out there, do not let them get a hold of you.
The Interest Rate Issue
Loans for bad credit applicants come in two main forms: secured or unsecured. If you have an asset to pledge as a collateral, say a car or a property, then you will not have to worry over high interest rates. But if it is not your case, or you simply do not wish to put an asset of yours at stake, then you might be in for a higher interest rate. This is simply because the lender takes a higher risk by lending you money. In fact, these are called high risk personal loans. Bear in mind that those in possession of a collateral to pledge as security have superior chances of approval. Having a co-signer will also be to your advantage.
Minimum Requirements Or Requirements Are Minimum? Both!
There are only a few things you will need in order to qualify for a loan like this. Take note.
1) A steady source of income: whether you are employed or self-employed, you must confirm that you can actually repay the loan in time. A proof of income will be needed to attest this fact. If you are employed, then make copies of your last 3 paycheck receipts. In case you are self-employed, tax presentation copies will be required.
2) A proof of residence: potential borrowers must be US residents.
3) These last two requirements are not necessary for all lenders. A fixed phone line is demanded by certain lenders, though this is kind of old-fashioned. Most lenders require you to have a bank account for money deposit and withdrawal of the fees.
As you can see, practically anyone can get their hands on a bad credit loan. Patience is the key ingredient on this recipe. No matter how discouraged or frustrated you might be, no matter how many times you have faced denials, never give up. It is only a matter of time until the right lender comes along, and with him, funding will arrive to. Do not lose hope!