Getting an unsecured loan with bad credit can happen. However, it is important for borrowers to be prepared for the experience in terms of expectations and qualifications.
With an economy that is still recovering, there are a lot of people who need financial help. Just look at the hope in the eyes of average folks when the lottery reaches $300 million. Free money aside, though, there are many people around today who could use the help of a loan. For those with bed credit, unsecured loans are hard to come by, however. This leads many to wonder if the effort of contacting lenders is even worth it. Well, let me tell you, it is!
There Are Loans for You
If you have bad credit, unsecured loans seem impossible. They are a huge risk to lenders since there is absolutely no guarantee that they will get anything back for the trouble that they took to lend you money in the first place. However, there are still options for those with bad credit. What is necessary, however, is for these borrowers to be realistic about what they can expect and for them to go to the right resources to find what they need.
Keep Expectations in Check
Are you tens of thousands of dollars in debt? Are you looking for an unsecured loan to fund a luxury such as a vacation or a wedding? If this is the case, getting a loan is a bad idea and any lender worth his salt will tell you that. However, if your bad credit is as a result of past experiences out of your control, maybe a sudden job loss or a bankruptcy that you had years ago and/or if the money you need is for an important purpose such as medical bills, then you are far more likely to find a lender who will be willing to help you out.
The key to getting an unsecured loan with bad credit is keeping your expectations in check. You will not be able to get $50,000, but you may be able to get $5,000. You can get money for essentials, but not for luxuries and lenders will ask.
Meet the Qualifications
There are several qualifications that a person needs to meet in order to be given an unsecured loan. These are not all reliant upon credit, despite popular belief to the contrary. Instead, lenders want to know both your past experiences with finances (i.e. credit score) and your future prospects (i.e. income).
In order to qualify for an unsecured loan with bad credit, you must meet all of the following before credit is even taken into account:
– You must be at least 18.
– You must be a U.S. citizen or qualified resident.
– You must prove that you have a consistent source of income that is sufficient to support your loan payment in addition to your other financial obligations.
As you can see, credit is not the only factor at work in a loan determination. Whats more, larger incomes can make more of a difference than credit score so long as you do not have too many other bills.
Consider a Cosigner
As a last resort, many borrowers with bad credit choose the option of a cosigner who has both sufficient credit and income to support their desired unsecured loan. If this is an option for you, it can work out well. However, you also need to note that, should you be unable to repay your loan, that burden will fall on your cosigner. This can lead to problems in your relationship.
Look at Your Options
If you want an unsecured loan with bad credit it is important to look at your options. Know the rules and what you can handle. There are plenty of lenders out there who will serve you if you are informed and prepared for the responsibility of an unsecured loan.