So, what four ways are there to get a personal loan if you have a bad credit rating? Just to clarify what a personal loan is. According to ARCCT Loans, it is simply a loan which is not secured against a house or a property so it is an unsecured type of loan, that is what is referred to as a personal loan.
Bad Credit Credit Cards
So, the first type of bad credit personal loan is a bad credit credit card. So, these work in a very similar way to a conventional credit card but interest rates are typically a bit higher they are around the sort of thirty-five to forty percent mark. You can typically only get credit up to about $2,000 and they do have a time about a week or two weeks for you to apply to get that loan before you know you find if you are successful or not in terms of your application. Also, there are some conditions which will apply so some of them. For example, your last missed or late payment needs to be at least six months ago or last bad mark on your credit report needs to be six months or sometimes even a year ago. So, there are conditions that apply, and that can be a good option, so it is always worth applying and seeing if you can get a credit card with bad credit.
Secured Personal Loans
The second personal loan option is a secured loan, or sometimes called a guaranteed loan. Many people who are struggling with how to get a personal loan with bad credit can check into this type of personal loan. These types of loans are typically available from $100 all the way up to $20,000. Secured personal loans, which are short-term loans up to a month and they can have interest rates up as high as about 700 percent APR which is a lot cheaper, incidentally, than a payday loan which can be up to five thousand percent APR. So, these loans are very quick you can have the money same day, sometimes in an hour. But in order to get approved for a secured personal loan, in many cases, you do need a friend or family member as a guarantor to basically to back up your loan. Whoever you choose for this will need to have a good clean credit score and they are there to back up your loan.
One advantage to a bad credit personal loan that is secured is that they are much cheaper than a typical payday loan as the terms of the personal loan are not nearly as expensive. Again, you’ll need a someone to guarantee your loan; so again; a friend, a colleague, or possibly a family member who has a clean credit rating due to the fact that they will be backing up your loan. There are many online lenders who provide these types of loans if you would like to find out more options, it might be a good idea to get a number of quotes and compare the options that you have. It is essential that you understand the entire cost of the loan and use a loan calculator to help you decide if this type of loan is right for you.
Your third option for a personal loan with bad credit is called a doorstep loan. This type of lending is where you can borrow typically between $150 to $70. Generally, they are approved quite quickly, so you can get the cash you need very quickly. The interest rates are typically about 275 to about 550 percent APR and these types of loans are typically spread over about a year and in terms of your repayments. The difference with these types of loans is that the lender’s agents will actually come around to your house and will pick up the loan repayments. They are a slightly different version of sort of short-term lending but the payments are spread out. You can compare with payday loans where typically you would make the payments you pay it all back in one lump these are repayments and paid out over a year. So, doorstep loans are the third option for a personal loan with bad credit.
Short-Term Personal Loans
And finally, you have probably heard about payday loans mentioned online, on tv, even on radio ads. On television there are lots of payday loan commercials, especially during daytime television, so you know how popular they have become. Many companies offer payday loans typically up to $1,000 or $2,000. Typically, you borrow this for two, three, or up to four weeks up to your next payday. They can be very expensive, as they are very much only designed for short-term lending. So, if you need some cash just for a couple of weeks they can be a good solution for fast cash, but if at any time longer than that they can get extremely expensive and be the cause of some major difficulties.
So, four ways to get a personal loan if you have bad credit are a bad credit credit card, a secured personal loan, a doorstep loans and a payday loan. You can find quotes online from reputable lenders who are experienced in dealing with many types of bad credit situations in which people need quick cash for one reason or another.