Bad credit history loans provide a means of borrowing money when an individual has failed to comply with the T&C’s of a credit agreement. This could be as little as a late payment to filing for chapter 7 bankruptcy. The more serious the credit transgression, the more expensive it will be to borrow money. However, there are a number of bad credit lenders who are prepared to take on this risk.
Bad Credit History Loans
Finding loans for people with poor credit is more difficult, but it needn’t be an insurmountable obstacle. Whilst poor credit secured loans are an option for a homeowner, there are also a number of adverse credit unsecured loans available for tenants. It is possible to borrow money from Prosper.com, Credit Unions, pawnbrokers or a same day payday loan lender. Some lenders don’t perform credit checks.
Loans for People with Poor Credit
- Pawnbroker loans. Adverse credit history isn’t an issue when borrowing money from a pawnbroker because there is no credit check. The borrower provides collateral, such as gold or jewelry, to get a poor credit secured loan. The amount that can be borrowed will depend upon the value of the asset, but some loans are for upwards of $10,000. The larger the sum of money borrowed, the lower the APR. Interest rates vary considerably between lender, but 70% is about average.
- Prosper loans. Rather than borrowing money from a bank, it is possible to get a bad credit history loan from a peer-to-peer lender. A credit check determines the category the borrower falls into. Whilst Prosper no longer assists those with very poor credit, they can assist those with a credit score rating that is below average.
- Same day payday loans. Given that the APR is over 1000%, it is normally only feasible to borrow money over a month or less. Payday loan providers will lend as much as $1,000 without the need for a credit check. Applicants will need to be U.S. citizens, in full-time employment and be in a position to provide photo identification.
- Credit Union loans. It is necessary to join a Credit Union on the basis of a common interest, such as locality or employment. Once a member, it is possible to get a bad credit history loan, provided that the borrower is able to demonstrate affordability. Unlike private lenders, they exist purely to serve the interests of their members and not to make a profit.
Poor Credit Secured Loans
Provided that a homeowner has sufficient home equity, it is possible to get a loan for people with poor credit. The provision of collateral reduces the lending risk as the lender is able to sell the asset to recover any money they have lent. Other secured loan criteria include a stable employment history and affordability. Always think carefully before taking out a loan that is secured on the family home.
Whilst there are a number of bad credit history loans available, the cost of borrowing will be higher. This means that it is important to establish affordability prior to signing up, particularly if considering a poor credit secured loan.