Having a poor credit score will limit your options as it pertains to borrowing money. With that said, there are some online lenders that extend credit even if you have had problems in the past. Here are some of the items to look for and strategies to employ in obtaining online financing.
Bad Credit Loans Online
Just a simple typing of bad credit loans on Google will bring back so many results it will make your eyes pinwheel. Instead of wading through a myriad of options, which will take time and could test your patience, you should first start with local lenders.
The reason for this is many offer online and in person options that way if you have any questions you have a live person you can turn to. Even more important, if you have a good relationship with a local bank or credit union they would be a good first place to turn, as they might be able to work with you depending on your situation.
Meanwhile, if you can't find many good local options, then there are plenty of online personal loans available. To help you narrow down the list, here are some things you'll want to be mindful of:
- First, what are the fees the lender will assess for the loan? By having a lower score, you will pay more in interest, but often lenders will try to take advantage of you by charging obscene rates and other fees that make the loan much more expensive.
- With this in mind, compare online lenders. Find several that offer competitive rates then research their reputation with the Better Business Bureau. If they have a good grade, then consider applying for the loan.
Bad Credit Personal Loans
When you are ready to apply, you'll want to do several things first to make sure your information remains safe. Check the lender's website to see if their web address on its application page begins with https. This adds another level of protection that can keep your information safe.
Next, you'll want to apply using a secure internet connection. Public Wi-Fi is no good, since people can easily hack in and steal your information. Therefore, it's ideal to apply at home or your office –if need be-to keep your information secure. Lastly, make sure your computer has good virus protection installed that way you know for certain there isn't a malware program copying your information.
These things aside, applying for a loan online is easy. You'll need basic information including income from your occupation, your social security number and how much you pay per month in housing costs (rent or mortgage). Some lenders might have additional verification whereby you have to answer questions about previous loans or credit cards – information they pull from your credit report.
Additionally, some lenders might ask for documentation to support what you put on the application. Therefore, have your most current pay stubs and a bank statement ready to send to them if need be.
Smart Strategies to Employ
Before applying for the loan, here are some tips to consider that can save you money:
- Is this loan for an immediate need or a want? If it's for a want, consider holding off until you improve your credit score. Raising your score will help you earn lower rates thereby reducing the costs of the loan.
- You should also minimize the amount you need to borrow. Having a lower score means borrowing will be even more expensive, so try to save a portion of the money you need to borrow before applying.