Can You Get a Loan With Unhealthy Credit Score

Can You Get a Loan With Unhealthy Credit Score

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One of the greatest problems with your credit score lies in the fact that you probably won’t pay much attention to it until you need a loan. By then, however, it might already be too late. Sure, some guides promise you a way to improve your credit score in as little as 30 days, however, these methods aren’t reliable, nor do they give consistent results. Moreover, what if you don’t have the luxury of waiting for these 30 days? Well, even though an unhealthy credit score does limit your possibilities, there are certain things you can do in these situations. Here are several ideas and suggestions that might turn out to be life-saving.

  1. Consider the pros and the cons

The real question isn’t whether you can or cannot get a loan, of course, you can. The question is – under what terms? Needless to say, this is something that’s definitely worth examining. If the time is not of the essence and you need your loan in several months, then, sure, it might be worth your while improving your credit rating for a while. The problem with this method is that it costs you both time and money, which is why, in the end, the saving that you make may not even be worth the effort you’ve invested.

To see if something can be done about this, you need to understand all the factors that are affecting your credit health, things like payment history, credit usage, length of your credit history, recent credit and even weight in all the credit types you’ve encountered so far. The length of the credit history is particularly important, as well as one of the mistakes that most people make. Namely, closing an old account as soon as you pay off the credit can shorten your credit history. This goes more than one way and is, therefore, worth paying some attention to.

2.Looking for specialized lenders

One more thing worth taking into consideration is the fact that not all lenders are merely tolerant towards people with bad credit. In fact, some of them even specialize in providing financial assistance to people with poor credit score. Finding an agency that provides bad credit loans, to people in need will provide you with a far more ethically sound treatment, than if you were to just try and persuade a bank or a traditional credit union to help you out. These loans are provided for many different purposes, ranging from personal loans, business loans and vehicle loans. Ironically, there is even an option for debt consolidation, which means that you can use a bad credit loan in order to improve your credit.

3. Loans with a co-signer

Perhaps the most important thing you need to understand is the fact that some loans don’t necessarily require a great credit history, due to the fact that they depend on a co-signer system instead. This is a person with a healthy credit score that can vouch for your ability and reliability to pay them back. In a situation where you fail to meet these responsibilities, they will be responsible to make all subsequent payments. In that case, even with a poor credit score, you may be able to secure a loan with a low interest rate. Nonetheless, finding such a person may turn out to be an even greater challenge.

4. Acting out of desperation

Most importantly, you need to understand that, as we already mentioned, even in financial dire straits, you still have some options in front of you. Therefore, you need to look out for loans you need to avoid, like those with incredibly short payback terms, steep interest rates or high origination fees. Just look at these things from a logical perspective. You’re in a bad spot and there are always those praying on people in desperation. Try to think rationally, no matter how hard the situation may appear.

5. Considering the downfall

At the end of the day, you need to keep in mind that your ability to get a credit isn’t the only problem with a credit loan. First of all, it might make it difficult for you to get a job, seeing as how almost half of the employers take a look at one’s credit prior to making a decision on whether to make a hire or not. For people that are occupying positions in administration or accounting, this can be a major issue, seeing as how it reveals just how fiscally responsible one is.

Aside from this, it’s also possible that a bad credit score will harm you while trying to get an apartment. Think about it, the solvency of a potential tenant is the biggest concern of the majority of landlords so what better way to check this than to check their credit score. A similar thing takes place with people who are looking for an insurance policy. It’s not just about the money, seeing as how some studies have shown that people with lower credit score, on average, seem to be more prone to accidents. Simply because they seem to be overall less responsible.

Lastly, it has a way of affecting everything from your cell phone plan, all the way to your ability to enlist in the armed services. For this reason alone, you need to understand the full gravity of the situation you’re in and realize that any serious organization might look down on you simply because you have a low credit score. Therefore, you need to consider improving it even after you get approved for the loan that you so desperately need.

In conclusion

So, to repeat our earlier statement – it is definitely possible to get a loan with a bad credit score, even a favorable one if you look hard enough. Still, this by no means implies that you can just neglect your credit score in its entirety. Why not make it easier on yourself, in so many aspects of life and tend a bit about your financial reputation? Nonetheless, if this doesn’t work out like you wanted it to, it’s always good to know there’s a plan B.

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