Finding Bad Credit Loans

When a less than stellar credit history stops you from getting the loan you want, you have two options on how to proceed. You can give up and put your plans on hold, or you can look for bad credit loans to meet your needs. Loans for shaky credit scores may not be as desirable or plentiful as they are for the A-credit borrowers, but you do have options.

Starting your search

Even in times of economic downturn, you can still find loans available for virtually every credit score. Rather than applying for the first loan you find that caters to bad credit, be willing to put a little more effort into your search. Loan options with attractive terms may not be the first ones to pop out at you.

Before you approach any lender, know your credit score. Although no lender can guarantee approval based on score alone, bad credit loans typically tie interest rates and terms to the score. Giving your lender an estimate of your score allows him to talk about your options with his company. Avoid submitting applications with multiple lenders because this lowers your already perilous credit score. If the lender can tell you that they only approve loans for certain credit requirements you don’t meet, apply elsewhere.

Finding a lender

Hundreds of online companies compete for your business, but you may find local lenders also willing to make bad credit loans. Talk to your banker about your situation and find out what options your financial institution has for you. Depending on the size and nature of the bank, she may have latitude in making loans to longstanding customers. This is especially true of smaller, locally owned bank branches.

Nationally associated financial institutions have other benefits during your loan search. While you may not meet strict underwriting guidelines, financial services companies often have sister companies that handle those loans they cannot. Let your banker refer you to the finance company they use to see if loan approval is possible. Just remember that finance company rates for bad credit loans will be substantially higher than the rate your bank offers, sometimes by several percentage points.

If you’re unable to find bad credit loans available close to home, your search isn’t over. Online lenders and payday loan companies are still available to help you out, so long as you understand they charge interest and fees well above the standard bank loan.

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