A bad credit score can make borrowing money difficult. There are loans for people with bad credit like payday loans or cash advance loans, but these are short-term loans and often cannot be obtained for more than $1000 if that. What if you are looking to borrow money to consolidate existing debt?
Borrowing for a Good Cause
Oftentimes, hardships can strike even the most dutiful bill payers and income earners. The result is a trashed credit score that can make borrowing from traditional lenders impossible. It can even make meeting unexpected bills much harder when you are trying to juggle your regular bills and debts.
Most people think that when it gets this hard the only option is to file bankruptcy. Your credit is already low and you cannot do much to build it back up so you assume bankruptcy is not going to be that bad.
Many of your unsecured debts will get wiped out in a bankruptcy making it easier to pay everything else. There is a bit of a catch, though.
Challenges of Filing Bankruptcy
You have to qualify to file a bankruptcy. As odd as that may sound it is the truth. Your income and debts may qualify you to file a Chapter 13 which means you will be put on a five-year plan to repay any debts or arrearages that do not get wiped out by the filing. If you cannot get a Chapter 13, you may need to do a Chapter 7 if you have assets like a car or a house.
Essentially, you would be asked to sell off any possessions not exempt from the filing and start over. The sound of bankruptcy sounds like a relief at first, but unless your bank accounts or wages have been levied, you should find other options. One good option is to find debt consolidations loans for people with bad credit individuals.
Finding the Best Loans for Bad Scores
There are lenders available that can provide several thousand dollars in loans to you. This is even if your credit is poor. A poor score is generally considered to be about 620 or under.
If you approach the lender and tell them you are using it to consolidate existing debts your chances of being approved increase. Look for lenders that offer installment loans.
You do not need to have much to qualify for them. You need a bank account, a form of income and proof of the income in the form of pay stubs or tax returns.
The lender will most likely not take your score into account when you apply. This will increase the chances of being approved. If necessary, you could ask a co-signor to help you get the loan your need. Be careful with this option. If you default on your payments, the co-signor will be responsible for repaying the loan.
Loans are available for people with bad credit. You have to look for them, but if you need them to repay existing debts your chances of getting them are quite good.