Guide to Bad Credit Personal Loans Guaranteed Approval
Lenders consider several factors when it comes to approving a loan application. For borrowers to qualify for a loan, for instance, they need to have a good credit score since it’s one of the main factors that determine creditworthiness. A low credit score, on the other hand, spells trouble for borrowers who want to borrow money from a traditional lender.
The good thing is that there are lenders that cater to the needs of borrowers with poor credit scores. For instance, if you need to get approved for a loan in this financial position, you have more chances for qualification when you go for bad credit personal loans guaranteed approval at MatchFinancial.com.
For more on this topic, make sure to read this blog article about bad credit personal loans guaranteed approval.
Is This Loan Type Legit?
When it comes to the “guaranteed” word in the name of this loan type, you have to understand that it’s not entirely accurate. It’s only a marketing tactic, but you can really find lenders that offer bad credit personal loans with fast processing time.
Lending companies that specialize in this loan type are more lenient with your credit requirements. It doesn’t matter much if you have mishaps in your credit history or have a less than stellar credit profile. These non-traditional lenders will instead ask what kind of work you currently have and how much money you receive monthly.
Yes, bad credit personal loans exist. However, you should be aware of scammers and those landing companies that charge too much from their borrowers. Don’t easily fall into the trap of paying upfront fees. Moreover, if a bad credit loan has an interest rate or fees that exceed the regulated limits, you better avoid it.
Always check the background of the lender if it has a trustworthy profile in the online lending world. Look for a credit license, read online reviews, and search the lender on sites like Better Business Bureau to determine if it’s legitimate.
Where Can You Apply for Bad Credit Personal Loans?
There are three sources of bad credit personal loans that you can go to if you need to borrow some money. These are loan aggregators, direct lenders, and peer-to-peer lenders.
Loan Aggregators
Loan aggregators partner with different lenders to provide bad credit personal loans to people who need it. Typically, they have a website where borrowers can send their applications. Then, loan aggregators will submit loan applications to their lending partners for perusal.
Since there are many lenders that check your loan application, it means that you have more chances to get approved for a loan. Even if one lender may turn down your application, another lender may give you a thumbs-up.
Direct Lenders
Direct lenders are different from loan aggregators since you’re working with a lender directly (it’s obvious to its name, right?). So, you apply for a loan to the lender, and if you’re approved, the funds will be sent to you by that lender.
Most direct lenders that offer personal loans for borrowers with bad credit have business operations online. Traditional lending institutions like credit unions and banks can also be called direct lenders.
Peer-to-Peer Lenders
Another avenue for getting bad credit personal loans are peer-to-peer lenders. These lenders work in a P2P network, which means that they mainly operate online.
P2P lending works by matching you with a lender that offers the type of loan you want to obtain. Most lenders in a peer-to-peer network may not be bankers or lenders per se. Even an individual can lend you money if he/she is willing to.
One benefit of going to a P2P lender is that you may enjoy a favorable interest rate and repayment term. However, you should also be careful against fraudulent P2P platforms, security risks, identity theft, and unwarranted withdrawal of funds.
Does Bad Credit Personal Loans Affect Your Credit Score?
Yes, bad credit personal loans can impact your credit score. Lending companies that offer this type of loan submit reports of your payment history to one or more credit bureaus. So, if you’re paying the principal and interest on schedule, it will have a positive reflection on your credit profile.
However, if you don’t pay the loan on time or you default on it, it’s possible that it can hurt your credit score. So, set it as your responsibility to make timely payments on your debt obligation.
You should see to it that you create a budget plan for your loan repayment. In this way, you’ll have the money set aside for the loan repayment, and the repayment schedule won’t slip out of your mind.
Takeaway
Being in a financial situation of bad credit can really lower your chances of getting a traditional loan. That’s why you should apply for a bad credit personal loan guaranteed approval from a non-traditional lender. Just read this article if you want to learn more about this loan option.