How Do I Secure A Personal Loan If I Have Very Poor Credit

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Most people obtain personal loans through high street banks and institutions, which will usually turn you down if you have a poor credit rating. You will certainly struggle to get a loan through this type of standard lender, and you could even damage your credit rating further if you keep applying unsuccessfully for loans. This is because each time you apply to borrow money a credit check is carried out. This shows on your record and can be detrimental if you have too many.

For that reason you need to be fairly sure that you have a good chance of being accepted before you apply for a loan. You can only do this by applying for a personal loan that is either from a lender who specialises in providing money for people with very poor credit, or by applying for a type of loan that does not rely on carrying out a credit check. This article looks at several different types of loan you can get when you have very poor credit and recommends a few good lenders.

Payday Loans - For Small Short Term Loans

We normally think of personal loans as being for fairly large amounts of money to be paid back over a period of a year or more, but if you only need quite a small amount of money for a short term emergency, there is another option open to you, however poor your credit rating is. Payday loans are an extremely common way to secure modest amounts of cash, provided you can pay it back very quickly. The attraction of payday lending is that it does not depend on a credit check (some lenders still carry out a check, but there are plenty of good lenders who do not).

The way these work is that you can apply online and get cash delivered straight to your bank account within as little as an hour or two, which you have to repay in full when you next get paid. Because of the limited amount being borrowed, and the short timescale, all the lender really needs to know about is your job and your bank account. Provided you can prove you earn above a certain amount and have a legitimate bank account, you are pretty much guaranteed a loan.

You can read more about this type of cash advance lending on the Payday Loans page, where you will find further information and recommendations for a list of good lenders.

When You Need More Money For A Longer Period

If the amount you need to borrow cannot be covered by a payday loan, and you are looking for something more like a standard personal loan, you can try one of the more well established and reputable lenders who specialise in loans for people with poor credit. There are recommendations for some of the best UK and US lenders on the main Borrow Money/Loan page.

Secured loans

The other widely used type of lending for people who need to borrow fairly substantial amounts of money is a homeowner secured loan, or home equity loan. These are only an option if you own your own house or have a mortgage, and should not be entered into lightly. The money you borrow will be secured against your home, so ultimately the lender's security comes from knowing that if you cannot keep up with payments they can arrange to sell your house to repay their loan.

Given the high value of the asset that is used to secure the loan, they are a good way to access quite large amounts of money, which can be paid back over an extended period of time. You can read more about this type of lending on the Secured Loans page.

Should Your Credit Rating Be Higher?

A very poor credit rating can cause all sorts of problems, which is fair enough if your rating is accurate and based on a true record of your history, but very often there are mistakes on credit reports that can lead to people having a lower rating than they deserve. The most common problems that are found tend to be genuine issues which were legitimately part of your report in the past, but which should by now have been removed.

There is an easy way to check your credit report free of charge to make sure there are no errors on it. If you do find any errors on your report you need to write to the credit agency and explain what you think is wrong and why. UK and US citizens and find out how to get their free credit report on the Credit Score Ratings page.

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How To Get A Personal Loan

When You Have Very Poor Credit

Find Out How To Borrow MoneyWhen You Have Very Poor Credit