Whether you’re looking to buy a new property, renovate the house or clear off your debts, there’s a long list of reasons why you might be considering a loan. Borrowing money from a bank or financial organization will depend on your credit score, though, which is also known as your credit rating. The higher your credit score, the more chance you have of getting your loan accepted, but what happens if you’ve got a low credit score?
Thankfully, you can still get a loan with bad credit, although your options may be reduced. If you’ve got a poor credit score, it means you’re a riskier person to lend money to. Your loan may have very specific terms and conditions, including higher-than-usual interest rates, or it may ask you to secure a high-value asset such as your property against your loan. If you’re on the search for a bad credit loan, we’ve put together a list of the top features to look out for, to help you make the best decision.
From high-interest rates to repayment terms and conditions, we take a look at the top features you should consider when you’re searching for a bad credit lender:
1. Low-Interest Rates
If you have a poor credit score, your loan’s interest rate (APR) will be much higher in comparison to someone with a high credit score, but it’s still important to shop around. There isn’t one set interest rate for people with low credit scores, and different lenders will offer you loans with varying interest rates. Thankfully, once you’ve made your decision and you’ve been accepted for a loan, regular monthly repayments will help you improve your credit score.
2. No Admin Fees
Some bad credit lenders will add ‘admin fees’ to your loans, but not all of them. Admin fees are unfortunately just another way for lenders to get some additional money from you, so always make sure you check your loan’s terms and conditions for admin fees.
3. Wide Range of Choices for Repayment Terms
The repayment term of your loan is how long you’ll make monthly payments until your loan is paid off. Your repayment term also affects the interest rate of your loan. A longer-term loan may mean lower monthly payments but it could also mean you’ll end up paying more money in the long-run. Always make sure your loan provider offers a decent choice of repayment terms to make sure your loan works right for you.
4. Guarantor Options
Guarantors are a great way to help keep your interest rate low and ultimately improve your chances of being successful for a loan. A guarantor loan is an unsecured loan that requires you to list a person that you know to act as a ‘guarantor’. This is added reassurance for your lender because if you’re unable to repay your loan, the responsibility falls onto the person that you’ve listed as your guarantor. If you’re in a position where you’re confident that you’ll be able to repay your loan, always check if there’s an option to add a guarantor. Just be aware that if anything goes wrong, it could seriously compromise your relationship with your guarantor.
5. Positive Reviews
We live in uncertain times, and if you ever find yourself in an unfortunate situation where you might be unable to make a monthly payment, it’s important to know that your loan provider’s willing to work with you through the situation, rather than against you. Always make sure you check the reviews of a lender before choosing them for a loan. Poor reviews could indicate terrible customer service or hidden fees. Some websites specialize in ranking bad credit lenders, so make sure you always read what the experts are saying about lenders. Trustpilot is always a good indicator of how good or bad a company is, too.
6. The Lender’s Website Looks Legitimate
Serious lenders that are lending thousands of dollars in cash every day have the resources to have a professional website. If a lender doesn’t care about how they come across online, what does that say about their service? You should always check the lender’s website has a valid HTTPS certificate and clearly outlines how they work with people who have poor credit. If something sounds too good to be true, or if something feels off about the lender, go somewhere else.
7. Requests For Your Financial History
No legitimate lender will ever guarantee your loan without wanting to see information about your income and credit report. If you find a bad credit lender that isn’t interested at all in your credit history, it may not be a legitimate lender.
How to Find The Best Bad Credit Lender
If you have poor credit and you’ve previously been denied a loan, don’t give up yet. It’s still possible to get a loan with poor credit history, you just need to find the right lender. By following the advice we’ve provided above, you should be able to find the right lender that lets you customize your loan options and provides an interest rate that will still allow you to borrow without taking a significant financial hit.
That said, with so many bad credit lenders out there, you must find the right lender for you. Bestloansforbadcredit.com has been created by lending experts to help people with poor credit scores find the best loans for them. If you’re struggling to find the best bad-credit lender, head over to the website and browse the latest deals.