Personal Loans With Bad Credit
You never know when disaster is going to strike. Suddenly, you owe hundreds of dollars to the car mechanic for an emergency repair, or you need to cover a visit to the ER.
Or maybe the situation is just the opposite. When opportunity knocks, there may also be a limited time to procure the financial resources needed to fund a start-up or make a move across the country to a new job.
There was a time when it was difficult to qualify for a competitive loan with bad credit history. In fact, it was hard not to get scammed outright. But that is no longer the case today. In a time when more than half of Americans have subprime credit scores, there is a major demand for loans for bad credit.
Online and offline lenders have risen to meet that need with a wide selection of bad credit personal loans. Consumers can apply for these loans quickly and easily, receiving the help they need for life’s most pressing financial needs.
What Are Bad Credit Loans?
A bad credit loan is a loan aimed at consumers who have credit scores under 630. For reference, here are the different FICO score ranges:
- 750 – 850: Great Credit
- 680 – 719: Good Credit
- 630 – 679: Fair Credit
- 550 – 629: Subprime Credit
- 300 – 549: Poor Credit
Both subprime and poor credit are considered “bad” credit. Sometimes fair credit is known as “average” credit, while great credit may also be considered “excellent” credit. Note that the exact ranges are not fixed either; some lenders may denote slightly different ranges. See the table below for an example.
When applying for bad credit personal loans, what kinds of interest rates can borrowers expect? Here are estimated APRs.
|Credit Score||Range||Estimated APR|
|Excellent||850 – 720||13.9%|
|Good||719 – 690||18.0%|
|Average||689 – 630||21.8%|
|Bad||629 – 300||27.2%|
Those with really low scores may be denied a loan altogether in some cases.
How Bad Credit Loans Work
The estimated APR for loans for people with bad credit is far in excess of that for those with good or excellent credit. The reason for this is simple. People with low credit scores do not have a perfect financial history. They may have defaulted on previous loans or paid their bills late. That means that lenders are taking on a higher risk by loaning these borrowers money.
The high interest on bad credit loans helps to compensate for losses when borrowers default. In some cases, loans may also be “secured.” This means that they are tied to collateral. This is an object of value such as a vehicle. If the customer defaults on the loan, the lender has the right to seize the collateral to compensate for the loss.
Applying for Bad Credit Loans. Keep Calm and Watch Out!
Loans without verification. Lenders who ask no questions about your income and who do not require any form of verification.
No credit check loans. Look for those who offer soft credit check loans or “alternative” credit check loans instead.
Unreasonable repayment terms. If a borrower is taking out several thousand dollars through a personal loan, he or she needs more than a few weeks to pay it back.
Fees are charged upfront. This is a predatory practice if it isn’t incorporated into the loan itself.
Harassing calls. If someone calls you or emails you out of the blue offering you a bad credit loan, that should be a major red flag.
Dubious emails. Emails which come from odd addresses or which include grammatical and spelling errors likely are from a scammer.
Lenders without registration. Make sure that the lender you want to work with is legally allowed to offer a loan in your state.
Pushy sales tactics. Lenders who continue to press you hard to take out a loan if you are not interested are likely predatory.
Once you are aware of these possible scams, it is relatively easy to steer clear of them. Do your research and use your common sense.
Online Loans for Bad Credit
Nowadays, borrowers no longer need to walk into a brick-and-mortar location to apply for a bad credit loan. They may apply for online personal loans from the comfort of home. The benefits of applying for a bad credit loan online include:
Convenience. When money is tight, it can be difficult or impossible to drive somewhere to apply for a loan. With an online loan, this is not necessary.
Widest selection. Online, borrowers can send out a single application and receive offers from a whole network of lenders.
More competitive loans. With access to a wider network of lenders, consumers can find the lowest interest rates and most favorable terms.
Fast and easy application and approval. It takes just minutes to apply for a bad credit loan online.
Quick disbursement of funds. Online personal lenders may disburse funds within one business day through direct deposit.
Who Usually Applies for Bad Credit Loans?
Wondering if a bad credit loan may be right for you? This type of loan is an ideal fit for the following:
- Borrowers who have bad credit and need access to a loan.
- Consumers who want to raise their credit ratings.
- Customers who have no credit and need a way to establish it.
Bad credit loans are only suitable for borrowers who have the means to make timely payments in full on them. Doing this will build credit. Missing payments will damage credit more.
What are the Benefits of Bad Credit Loans?
Loans for bad credit offer advantages like easy qualification even with poor credit or no credit, flexible approval and individualized processing. Sometimes even borrowers with steady incomes may have a low credit rating. Bad credit lenders take a more comprehensive, personalized view of your finances before deciding whether to approve your loan request. Build or rebuild credit is another great benefit of these loans. Raising your credit score by paying off a bad credit loan can open more financial doors in the future.
Appropriate Uses for Bad Credit Loans
A bad credit personal loan is yours to do with as you wish. A personal loan is not a replacement for a reliable income. It should not be used to pay regular bills except in situations which you know are temporary. Our clients use bad credit personal loans to cover emergency bills or repairs, for home improvement, debt consolidation, credit cards payoff. Of course, loans for bad credit can be used for building and rebuilding credit history. Remember, if there is a way to cover expenses without taking out a loan, that is usually the best course of action.
Types of Loans for Bad Credit
|Financial Product||Average APR||Main Benefits||Main Cons||Our Rating|
|Payday Loans||400%||Fast and easy to apply, easy approval, funds within 24 hours.||Don’t build credit history, high APR and fees, very little time to repay your loan.||2 / 5|
|Installment Loans||99%||May build your credit history, soft credit check, lower APR, more time to pay back the loan.||Interest can still add up over a longer time period. Lenders are not obliged to send your regular payment activity to credit bureaus, so with some of them it’s impossible to build credit history.||3 / 5|
|Personal Loans for People with Bad Credit||up to 35.99%||Timely payments will build your credit, soft credit check, the lowest possible rates and the longest repayment period.||Missing or late payments will damage your credit score. Some borrowers with weak or slow credit may not qualify.||5 / 5|
How to Apply for Bad Credit Loans
Borrowers are welcome to apply for an online personal loan via PayDayAllDay! Once the application is submitted lenders will provide all available loan options and elegibility. Choose a loan offer and await final approval. Receive your funds through direct deposit within 1 business day!
Personal Loans Requirements
- 1. The minimum age is 18.
- 2. You will need to provide income verification.
- 3. Furnish verification of an active bank account.
- 4. Provide an active email address and phone number.
- 5. You must live in the state where you are applying for the loan.
How Do You Recognize a Good Bad Credit Loan Deal?
We have already talked about red flags to avoid when applying for a bad credit loan. But how do you recognize a good loan offer? We offer a fast online application with no up-front fees to our customers. A wide network of lenders may provide competitive interest rates, transparent and clear terms, and affordable loan conditions! Our lenders run soft credit checks, verify borrower’s income and report payment activity to credit bureaus.
PayDayAllDay customer service team that is communicative, easy to reach, knowledgeable, and helpful. Taking a little extra time to compare loan options can help borrowers stay safe and avoid scams. It can also save money in terms of interest and fees.
Steps to Take Now to Improve Your Financial Health
Paying off a bad credit loan on time and in full can boost your credit rating. Here are some other steps to take to improve your credit score and take more control of your financial life:
- Order your credit report and correct any errors.
- Consolidate and pay off as many debts as possible.
- Get current on your bills and do not fall behind again.
- Look for creative ways to reduce your current bills.
- Check your budget at least once a month.
Why Choose Us for Your Bad Credit Loan Needs?
Here at PaydayAllDay, we make it simple to apply for a bad credit loan. Why go with us instead of one of our competitors?
With PayDayAllDay checking loan options and getting a lending decision is fast! We never ask for collateral or charge up-front fees. Our lenders use “soft” alternative check which doesn’t damage your score. Our wide network of nationwide lenders can provide you with the most competitive interest rates and terms, and a very high approval rating for applicants with bad credit. We are working for you 24/7.
Ready to apply? You could be just minutes away from getting the financial help you need. Just fill out the easy bad credit loan application form below, and we will connect you with top loan offers!
Personal loans are subject to state regulations, approval by the lender, and eligibility. The APR for a personal loan is contingent on a variety of factors including location, lender, the amount borrowed, fees, and terms. A single personal loan term ranges from 2 to 60 months, this is a long-term affordable financial solution. Missing payment or incomplete payment may have a negative effect on credit score and overall financial status. Customers with credit difficulties should seek consumer credit counseling.