Finding the Best Guaranteed Installment Loans for Bad Credit
Borrowing money when you are struggling to raise your credit score is not easy. Most lenders shut out borrowers who have poor credit, as they need them too high a risk. That may result in you having to look elsewhere for money when you are in urgent need of funds.
There is a market for people who have poor credit, but need money quickly. These guaranteed installment loans for bad credit can get you the money you need. But you must be careful when you are looking for guaranteed installment loans for bad credit direct lenders, as finding reliable lenders is the key to having a good experience with these loans.
Finding the Best Lenders for Bad Credit Loans
Many lenders specialize in helping people who have bad credit. There is an advantage for the lender, as they are able to charge different terms for these loans. Someone who is skipping the credit check will have to agree to a higher interest rate, as the lender is taking a bigger risk by lending money to such a person.
The issue for borrowers is that not every lender is reputable. There are some organizations that may not have the proper licenses, and they may have a less than stellar reputation for how they treat borrowers.
The best way to borrow money when you have bad credit is to assess the reputation of lenders online. You will be able to see reviews of various lenders, and it will give you an idea about whether or not they are safe.
Applying for a Bad Credit Loan
The application process for a bad credit loan is very simple. Most lenders will not ask you for too many personal details, beyond your name, address, date of birth, job, income and bank account information.
Many applicants wonder why they have to provide their bank account information. There are two reasons. The first is that you will be paid using direct deposit, which can only be done if the lender has your account and routing numbers. The second reason is because the lender can assess whether or not you are being paid using direct deposits by your employer.
While lenders do not care if you have bad credit, they are not going to lend to someone who is without a job. That is too high a risk, as the lender would know you have no immediate source of income.
Assessing Loan Terms Before Agreeing to Borrow Money
The terms on a loan contract can be confusing to someone who has never signed one in the past. Unless you have taken courses in finance, you may not understand what some of these terms mean.
You can do research online or ask a friend who has more of a background in finance. That will help you understand the various aspects of the loan agreement, including the interest rate, repayment schedule, late fees, and other details.
Most lenders will have a clear repayment schedule listed within the loan document. Most short term loans are due within weeks, but other no credit check loans may include installments that you pay over several months.
Paying Loans Early
Keep in mind that you cannot necessarily pay a loan early without incurring a penalty. Some payday or short term loan lenders do charge fees if you pay the loan too early.
Read the loan contract to see if there is a penalty for paying the loan early. Then compare the fee to the interest you would incur if you paid the loan using the original schedule.
If the fee is higher, payoff the loan as initially planned. When the fee is less than what you would incur in interest charges, you should still pay the loan early if possible.
Using Loans Strategically
A guaranteed installment loan for someone who has bad credit can be very advantageous, provided the money used in the right way. If you borrow $500 and spend it on going out to bars or restaurants, you are wasting the loan and gaining nothing.
Those people who use these loans to pay bills, buy groceries or pay rent can benefit. You avoid being without money during a time of need, and then you can pay back the loan when you get your next paycheck.
Having a poor credit score does not shut you out of borrowing money. You have to do a bit more work, but when you find a reliable lender, you can borrow hundreds of dollars without any credit check.
This article has been published in accordance with Socialnomics’ disclosure policy.
