Are you aware that American households are spending over $5,000 each month to cover expenses? If you’re feeling stretched to the limit when it comes to finances, you’re not alone. But if you’ve been late with bill payments or amassed debt, you may be wondering if you’re even eligible to take out a loan.
The good news is that it is possible to qualify and get the fast money you need. Read on to learn how you can borrow money with bad credit!
Check Your Credit Score First
While the idea of fast money might sound appealing, you should know where you stand financially first. And that means checking your credit score. Even if it’s uncomfortable, you’re better off knowing where you stand.
A credit score is measured on a scale from 300 to 850. The higher the number, the better the score. Lenders and other financial institutions will use your score to determine if it seems likely you’ll pay back any money loaned to you.
You should aim to keep your credit score at least above 670 to maintain good credit. But if your score is below 580, you’re looking at a bad score that may make getting loans harder. Even so, the possibility of getting a loan isn’t out of reach.
Investigate Lending Options
Begin your quest to borrow money by making a list of different lenders. Look at banks and credit unions in your geographic area, but don’t overlook online lenders.
Additionally, look at what will be required to secure a loan at each place. Ask how a particular lender weighs your employment status versus your debt, for instance. If you don’t meet the cutoff for credit score requirements, ask if there are other ways to improve your candidacy.
Ask about repayment practices, particularly if you have poor credit. And keep in mind that you’ll probably encounter a higher interest rate because of your credit score situation.
Fill Out Loan Applications
Once you’ve surveyed the possibilities, it’s time to fill out applications. Aim to do so at a handful of places, both in-person and online. It’s always better to have multiple offers than one choice.
When borrowing money, you’ll need to have certain key documents ready to show the lenders. You’ll need your W-2 forms and proof of payments from an employer. You’ll also need to have your social security card and other evidence of your financial holdings.
The application process itself may help you decide if you want to work with a particular lender, too. If you want more interaction and help through the process, a credit union might make sense. Having a stronger connection and level of communication can be helpful if you hit a setback during the repayment period.
On the other hand, if you just want to get fast money, that might not be a priority. Be aware, though, that you might only have a short window to repay the loan, so you’ll need to stay on top of it.
Look at Pre-Qualification
For pre-qualification, you’ll fill out forms that provide personal information as well as income history. You may need to disclose retirement plans or other savings, as well. Going through this process may seem tedious, but it will give you different rates to compare.
Undergoing pre-qualification is one of the easiest ways to see where you stand. Your credit history won’t take a hit for doing it, either, because you’ll only have to undergo a soft credit check. A soft credit check won’t show up on a credit report, and you can go through a pre-qualification check with multiple lenders.
No credit check loans may offer an even faster pathway to securing the funds you need. As the name implies, the application process won’t require you to undergo a credit check or deal with lots of forms. Everything can be done online, and you’ll be done with the application in as little as 5 minutes!
Compare Loan Offers
Once you’ve signed the paperwork for the loan, you should be able to get money quickly. Look at the interest rate assessed to you, as well as the terms of repayment.
If you’re not happy with the loan offers, there are some ways to boost your profile. For instance, you can add a co-signer.
This is when someone with better credit signs onto the terms of the loan with you. They’ll strengthen your application — and hold you accountable for repayments since making payments will impact them!
You also can pursue personal loans where you use collateral. In this case, you may use a valuable item, such as a motorcycle, to gain approval for the loan. If you don’t pay back the loan, you could lose your wheels, however.
Work to Improve Your Credit Score
Repaying your loan by the monthly deadlines is one good way to help improve your credit score. Make all payments on time to help build a positive record of timely payments. Check to make sure that your lender gives your payment information to the consumer credit bureaus.
Use money from your loan to help pay down larger piles of debt with bigger interest rates. Spend time going over your monthly budget, too, to find places where you can cut expenses. Your credit score can improve dramatically in a matter of weeks or months!
Borrow Money When You Need It
When you borrow money, you take a critical step toward improving your financial situation. Learn your current credit score first, and then begin filling out loan applications with the required financial documents. Then compare your loan offers and make sure you understand the repayment terms.
For more financial tips, check back soon for new articles!
