There are lots of rumours about different loan types, how they work, wo they are for etc and many are not true. This is especially true for bad credit loans because they are less well known. They are not offered by traditional lenders and this means that you will find that they are less common. Many of the people saying things about them may not even of even tried the loan out for themselves. This means that when you hear something about bad credit loans only being available for those with a poor credit rating then you should check out the facts before you believe it.
What is a poor credit rating?
You may not even know what a poor credit rating is and so it can be a good idea to start by understanding what this means. Your credit record is an official record of your personal financial situation. There are a few companies that have this information and you can access it yourself too for free. If you want to borrow money, then the lender will have a look as well and they will decide whether they are prepared to lend to you.
They will have their own way of deciding so your credit rating or score will not necessarily be relevant to them. They may have their own way of scoring or they might just look for certain things. As they are all different then it isn’t even that easy to know whether you have a poor credit rating or not according to various lenders. There are some things that all of them are going to look for though.
They will want to see whether you can be trusted to repay loans. This means that they will look at whether you have been able to repay loans in the past. If you have missed any repayments or missed repaying a loan completely, then you could find that you will not be offered a loan. There may be other things which could be problematic as well. Not being on the electoral role could be a big problem, as that is used to prove your address. If you have missed any payments on other things, such as utility bills, then this could also work against you as it will show that you may not be able to be capable of making loan repayments.
Do you need one to get bad credit loans?
With a bad credit lender, they will not worry about whether they feel you are capable of repaying the loan. They actually came about to help people with a poor credit record that needed to borrow money. This means that whether you have a good or bad credit rating it will not matter. However, as they were set up to lend to people with poor credit ratings it can make some people think that they are only for these people. This is not tur though. The loans are, in fact, for anyone. The lenders will not check and only lend to those with a poor credit rating.
Of course, if you have a good credit rating then you will have more options when it comes to borrowing. However, you may still decide that the bad credit loan will suit you the best and therefore you will be able to use it. This is because a bad credit loan has features which are unique to it and may therefore make it more suitable for you.
This includes the fact they can be arranged super quickly. This means that if you need money really fast, then they could help. Some lenders will be able to get you money within a few hours and perhaps even at weekends or at night time. Therefore, if having money quickly is really important to you, then these could be a really good help as you may find that no other lender can get money to you that quickly. You may also find that you will prefer a bad credit loan because it does not last long. Some people do not like being in debt at al and will want any borrowing that they do to be over as soon as possible. With a bad credit loan you will normally need to repay the whole loan back in full when you next get paid. This means that you will know that the loan will be gone completely when you next get paid. This can mean that it will only last a few weeks or perhaps even less and just a few days. It can be a good feeling knowing that it will not last long. You may also find the fact that you do not have to borrow large amounts to be an advantage. It can be daunting borrowing a big sum of money and sometimes annoying if you have to borrow more than you need.