If you have bad credit due to problems such as missed payments on bills, bankruptcy or foreclosure, it can be difficult to get an unsecured personal loan. However, you can still get an unsecured personal loan if you all of your bills are currently paid. You will need a steady, verifiable income and a credit score of at least 580. If your credit score is lower than this or if you’re behind on your payments, there are things you can do to improve your credit so that you can qualify for a loan.
Check Your Credit Report and Rating
You can get a free copy of your credit report at AnnualCreditReport.com. You can also check your credit score on this website, but you will have to pay a fee. Review your credit report carefully for mistakes. You must dispute any incorrect information on the report in writing both to the credit reporting bureau and the creditor to have it removed.
Get Current on Your Bills
Lenders today are very interested in providing unsecured personal loans to people with bad credit. However, nobody will give you a loan if you’re behind on your bills. If you’re having trouble paying your bills and debts now, there’s no way you can pay a monthly payment on a personal loan. You’ll have to find another way to get those bills paid before you can qualify for and pay back an unsecured personal loan for bad credit. Eliminate some unnecessary expenses and consider getting a work from home job to earn some extra money on the side to get enough money to pay the bills. Once they’re paid, make a budget and ensure that you have enough money each month to pay back your unsecured personal loan.
Go to the Government
The United States government has many loan programs for people in need. If you’re a victim of a natural disaster, you may qualify for a government loan. You may also qualify for a federal student loan if you’re a student attending college at least half-time. Federal loans are the best ones for students, since a bad credit history isn’t a factor in the loan approval process. Federal loans are also available for people with bad credit who are looking to start a small business.
Getting a Private Unsecured Personal Loan With Bad Credit
When you have bad credit, the best place to apply for a private unsecured personal loan is at your local bank or credit union. However, there are websites such as Credit.com where you can apply for a bad credit personal loan. Be sure you understand the terms of the personal loan and the monthly payment plan. Watch out for hidden fees and prepayment penalties. Also check the lender out with your local attorney general or the Better Business Bureau if a its name is unfamiliar to you. Also, avoid “payday” loans, which have extremely high interest rates and fees. If you have difficulty getting approved for an unsecured personal loan, think about getting a credit card designed for bad credit to help rebuild your credit rating.
Ultimately, getting an unsecured personal loan is very possible with bad credit. However, it’s important not to get caught in trap. You should always have a reason for borrowing money. If you’re always behind on bills, taking out a personal loan will only exacerbate the problem. Instead, you can find ways to save more money and to make more money so that you can make a better life for yourself.