Types of Loans for People with Bad Credit
Do you find yourself on Google searching “loans for people with bad credit”? There may have been a time where you were sick of hearing, “Sorry your credit application has been denied”.
A bad credit, however, is not as catastrophic as it once was. There are many solutions available online that can help you get the necessary funding you need. If you haven’t got the time to research it all yourself, don’t worry, we have you covered. In the following article, well introduce you to the most common types of loans for people with bad credit.
A Home Equity Line of Credit can come in handy when you can’t access traditional forms of funding. If you have equity in your property, you may borrow against it using a line of credit. HELOC loans typically come with a lower interest rate; particularly when compared to credit cards. You can use your loan on practically anything you want. This may include home renovations, travel or investing into other property. Lenders will typically allow you to borrow up to 80% of your properties value, depending on your financial capabilities. On the not-so-bright side, you’ll have to put your house down as collateral. Other disadvantages include a penalty if you don’t use the HELOC right away, including a closing cost.
P2P are platforms where operators match clients with lenders. You simply let them know what you’re looking for and they search for the best deal they can get you. This method, too, comes with lower interest rates and fewer fees. P2P lending offers some pretty generous loans for people with bad credit. Needless to say, it’s a much better option than going down to the bank just to have the door slammed in your face.
A co-signed loan is hard to secure. Somebody is essentially risking their credit score to help you obtain finance. So how does it work? Assume a friend of yours has a great credit score. You can persuade him into signing the paperwork for your loan. The tricky part is that, if you’ve shown a pattern of ruinous financial behavior, no one will be too keen on helping you out. If you do not stick to your repayment plan, the co-signers credit score will plummet and they will be responsible for all your financial penalties.
A Loan with Collateral
Providing collateral makes a lender stress-free, which increases your chance of obtaining a loan. Things are not so innocuous as they might seem. A default on your loan or keep on missing payments and the lender has every right to seize your collateral. If the collateral is your house, you’re in more serious trouble than you were prior to taking that secured loan. If you do decide to go with this option, be extra cautious with your finances. Budgeting and responsible spending are critical to ensuring that you are meeting repayments.
Discharged Part IX Debt Agreement Loan
If your financial situation is complicated that you have to look for loans for people with bad credit, then this might be the right solution for you. The Part IX (9) agreement might help you get some money. Part IX is an alternative to bankruptcy and it is an agreement between the creditors and you.
Cash Loans With No Credit Check
The number of Australians applying for a no credit check loan has increased considerably in the last 10 years. Formally known as small amount loans, the credit has a limit of $2,000 or less and has a term of reimbursement of 16 days to one year. The loan is unsecured and can be taken out in no time, with no credit score check.
So is this one of the best loans for people with bad credit? Whilst no credit check loans are great for people with bad credit scores, the interest rate is significantly higher than standard personal loans. If you don’t pay your bills on time, you will also be charged high fees. Fundamentally, no credit check loans are a great loan type for people who have bad credit and need funding, but they do come with their drawbacks.
Secured Personal Loan Without Credit Check
This is one of the loans for people with bad credit that requires securing the credit with one of your goods (your car or your house). If at some point in your loan, you cannot afford to repay, the lender can recover the money from reselling your assets. This type of credit is relatively easier to access as the lending institution does not check your credit history. Secured personal loans without credit checks are quickly accessible. Alternative lending institutions Bad Credit Loans can offer you a loan and have the funds deposited within as little as 24 hours after acceptance.
Unsecured Personal Loan Without Credit Check
Easily described as the opposite of the secured loan, an unsecured personal loan can be defined as an agreement between you and an institution that accepts to lend you money without asking for guarantees. Usually, the interest rates for this type of loans are higher compared to other credit lines.
Bad credit loans offer a variety of loans suited to people with complicated financial situations. We offer flexible and tailored loan solutions that can help you get back on track. If you are looking to access quick and hassle-free funding, contact Bad Credit Loans.