If you have a poor credit score, getting a loan can seem impossible. But, it can be done – you may not get the best terms, but it can be of a lot of help when absolutely necessary. Read on to know the best lending sources for people with poor credit scores.
Loan Aggregators
Loan aggregators can be a great choice for people with poor credit scores. Loan aggregators are not direct lenders, but a number of lenders offer their loans on the aggregators’ platform. Since these loan aggregators serve all credit levels, you can research different loan options and get a loan even if you don’t have the best credit score.
Non-Traditional Personal Loan Lenders
A few lenders specialize in offering only personal loans, sometimes without even checking your credit score. Instead, they take other factors like your bank data and information from other credit bureaus into account. While some of these lenders may charge you competitive interest rates, you may find that some companies that offer these loans charge an extremely high rate of interest – it’s best to avoid such loans. Ensure you check the interest rate and all the fees charged by the lender before you proceed with your application.
Peer-To-Peer Lenders
This may be the best source of financing for many people with poor credit scores. You may have to pay a high-interest rate, but you could qualify for a personal loan at a fixed rate, without having to submit any collateral.
Unsecured Credit Card
If you don’t want to go through the hassle of applying for a personal loan but still need to access credit, consider applying for an unsecured credit card that has more lenient eligibility requirements. While you may not get a top-tier rewards card, you may just be eligible for a credit card with basic benefits.
Loan sources to be wary of:
Payday Loans
These are essentially predatory loans that are specifically designed to target people who have a poor credit score – that’s why it’s best to avoid such a loan. The interest charged for these loans can sometimes exceed 300%, and these companies will need access to your bank account so funds can be withdrawn as soon as your paycheck comes in.
Loans from Brick-And-Mortar Banks
Brick-and-mortar banks typically only offer personal loans to people who have a strong credit history. So, if you want to apply to a traditional bank for a personal loan, you’ll need to have a cosigner.