When you have bad credit, getting a loan seems to be a farfetched dream. Borrowing is way more expensive, and your options are simply limited. But even with your less than perfect credit, you have to know that you are not a totally unlucky person because all it takes is more work and effort to get the funds that you need. Considering your situation, it is definitely easy to fall prey into the expensive traps that’s why it is best for you to know some of the things that you can try to increase your chances.
First, you have to know what bad credit is all about. There is even a possibility that your credit is not really as bad as you might think. If someone told you that your credit has destroyed your chances to get a loan, see to it that this is really true before you make a drastic move. Your credit reports might have some errors and when these are already fixed, things might already look different to the lenders.
Bad credit is a term that can mean entirely different things to the different lenders. A certain lender might be willing to help you while others will simply turn their back on you. Never be afraid to shop around first before you decide that your credit is a true dealbreaker. With these being said, you need to be careful about two things in this particular process.
For starters, make sure that you submit all applications in a short period, 2 weeks or so, for your credit not to gain a lot of injuries. Second, make sure that you only apply to the reputable lenders, like banks, P2P lenders, and credit unions. The predatory lenders will definitely give you a loan most of the time but this is something that you will surely regret in the long run.
If you have a really bad credit, the first thing you can do is to visit the credit unions. They might be more willing to give you bad credit loans and since these are smaller compared to the large banks, there is a higher chance that they will personally look at you, opposed to simply looking at your loan application and credit score. Sitting across the desk from another person increases your chances of getting a loan even with your bad credit.
The different peer to peer to P2P lending services are one more option that you can try to get a loan despite a bad credit. You might want to try borrowing from individuals instead of borrowing from the banks that have higher overhead costs and rigid rules.
The last but definitely not the least option is to tap into your family and friends. If you have a truly bad credit, the people that you know are the best choice that you’ve got. These people know you and they will be willing to take chances. When you do this, make sure that the process is done properly so everybody will be protected. Get the loan terms documented on paper and consider the use of a third party for processing payments.