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5 Steps to Get a Bad Credit Personal Loan - Unsecured Loans Now Articles Unsecured Loans Now Articles

5 Steps to Get a Bad Credit Personal Loan

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Posted on 12th January 2012 by Sandra Thompson in 1

Acquiring a bad credit personal loan is not so difficult these days since many lending companies are willing to extend financing to customers with bad credit.  If you need immediate financial help and wants to apply for a bad credit loan, remember this five steps:

1. Know your credit score. You can order your free credit report from www.annualcreditreport.com – the only resource authorized by the government to distribute free consumer credit reports.  If your report contains errors, your credit score can be badly affected.  You can send a dispute letter to the credit bureau to correct the errors and improve your score.  Remember that a higher score will win you a better deal when you apply for a bad credit loan.

2. Consider other options. If you need cash, don’t forget to consider alternatives such as borrowing from a friend or family member.  Since bad credit loans usually carry higher interest rates than regular loans, borrowing from a personal contact can save you a great deal of money on interest rate charges.  Don’t forget to create a written Agreement when dealing with a friend or relative about money matters to avoid problems.

3. Ask your credit union. It’s always a good idea to check a credit union when in search for a bad credit loan.  Credit unions typically offer loan programs to help members in need and you can get assistance at a much lower rate compared to commercial loans.  If you are not yet a member of a credit union, find out how you can sign up to be a member of a credit union nearest your location.

4. Compare bad credit loans online. You can easily compare loan deals from different lending companies that offer bad credit financing.  Gather loan quotes from potential lenders so you can compare the interest rates and fees.  This way, you can choose the best bad credit loan offer.  You will also be able to check the lending company’s legitimacy online.  Visit the Better Business Bureau’s website to find out about the company’s rating and performance.

5. Be careful with payday loans. A payday or cash advance loan offers short-term financing for borrowers.  This type of loan is payable within 30 days or by the next pay check.  Payday loans do not require credit check so anyone can easily obtain cash advance even with bad credit or no credit history.  Typically, all you need to qualify for a payday loan is to be of legal age, a resident of the United States, and show proof of a regular income or stable job.

While payday loans are technically easy to acquire, consumers must be careful not to resort to this option whenever they are in need of cash.  Borrowers must be aware that payday loans carry steep interest rates which can range from 100% to 300%, depending on the lending company.  If you’re going to borrow a payday loan to pay another creditor, you could end up with an even bigger debt if you fail to pay back the loan on time.

About the Author

Sandra Thompson is a loan consultant with http://www.unsecuredloansnow.com and has been providing consumers and business owners with Unsecured Loan since 1989. For years she has helped people with loan and credit problems especially pertaining to Unsecured Personal Loans, Student Credit Cards and Unsecured Credit Cards. Copyright 2012.

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