Six Ways to Get a Personal Loan With Bad Credit

loanHave bad credit? Is your checking account low on funds? No worries, while having bad credit does make getting approved for a personal loan more difficult, it doesn’t make it impossible. You can still get a personal loan with bad credit; you just have to be a little more creative with your loan search. Here are six ways to get the personal loan you need, even if your credit is bad.

1. Shop Around

Just because one lender has turned you down does not mean that all lenders will. Lenders’ guidelines and rates vary, so be sure to shop around to get approved for the best deal. As long as you keep all of your applications within two weeks of each other, the multiple inquiries will not hurt your credit score further, and you might just find a great rate.

2. Seek An Alternative Type of Loan

If the bank won’t approve your personal loan application, there are other types of loans you can try. Apply with a credit union, get a home equity line of credit or look into peer-to-peer loans. Because peer-to-peer loans come from real individuals, you may have better luck with them than with a financial institution.

3. Borrow From Friends or Family

If you have generous friends and family, you might consider asking them to lend you the money until you are able to pay them back. If you do get a loan this way, be sure to treat it as professionally as you would a bank loan. Get the terms in writing and pay the money back as soon as you can. Show them that you’re now responsible with your finances, and if needed tell them about what you’ve learned and actions taken to square your finances away.

4. Get a Co-signer

If your credit isn’t very strong, have someone with better credit help you out. A co-signer may be just what you need in order for the bank to reconsider your application. This isn’t as uncommon as you might think. I have cosigned with a sibling because they had a ghost account.

5. Put Down a Large Down Payment

The smaller the loan you need, the more likely you are to get approved, as the lender’s risk is reduced. If you have poor credit but can afford to save up for your purchase for a few months, you may find that you get a fantastic deal with a bigger down payment.

6. Improve Your Credit

Lastly, if your bad credit truly is stopping you from getting the personal loan that you need, find ways to improve your credit. Start by catching up on any bills you may be behind on. Then, work on reducing your debt. Skew the numbers in your favor, and the lenders may be willing to give you a second chance.

Don’t let your poor credit discourage you or keep you from getting the personal loan you need. Use these six great tips for getting a personal loan with bad credit, and you’ll have the loan you need in no time.

Featured image by https://dribbble.com/WSTMN

Speak Your Mind