The cat is out of the bag: 3 Lesser Known Ways to get a Loan with Bad Credit
Whether you are are thinking of applying for a small business loan or online payday loan, the first thing the lender will check is your credit score to determine your creditworthiness. In many cases, lenders just bypass the profile of borrowers who have a tarnished credit history. That said, all is not lost for people with bad or no credit. Borrowers with a less than minimum required credit score must not lose hope and follow the tips listed in the post to increase their chances of loan approval.
1. Make sure your credit report is accurate Your bad credit rating can be a result of human errors. Contact one of the three credit unions to get a copy of your credit report. Go through the transactions mentioned in the report carefully
and note down incorrect entries, if any. If for instance, you find an entry against a debt that you had already settled, dispute it immediately. Watch out for any inaccurate negative information and hard inquiries that were generated at least a couple of years ago and are still on your report.
2. Get a co-signer Even if you have bad credit, many lenders will be open to the idea of lending, if you are able to get a co-signer. Request a family member or friend who has a good credit score to become a co-signer. If you are successful in getting a co-signer, the interest rate will be calculated on the basis of the person’s credit rating. However, signing with a co-signer doubles your responsibility as late payments apart from impacting your credit score will also drag down the other person’s credit rating.
3. Join a credit union Credit unions, like commercial banks offer credit to borrowers. The only difference between the two lenders is that while most banks shut their doors to borrowers with bad credit, credit unions do not judge a person’s creditworthiness just on the basis of their credit rating. In order to be able to borrow from a credit union, you have to become its member. Still think getting a loan with bad credit is impossible? Getting a loan with bad credit is difficult, but not impossible. In addition to following these tips, consider getting an online loan for bad credit. To increase the chances of approval, opt for a secured loan.