Getting A Loan With A Bad Credit Score

Obtaining access to financing has gotten a whole lot more difficult over the last few years. It can be tough for a person with an average to below average credit score to get access to the funds that they need. There are some loan products that provide these borrowers with the funds that they need in a crunch. Here are three of the more popular ones.

Personal Loans

Personal loans are unsecured loans that are issued by a lender to a borrower. Unsecured personal loansĀ can be found at banks, credit unions, online lenders, and loan companies. These loans are often used to pay down existing debts such as credit card debt or to catch up on past due balances. A person with a long time history with a lending institution has a much better chance of qualifying for a personal loan since the lender already has a relationship with the borrower. The rates on personal loans vary depending upon the institution.

Bad Credit Loans

Bad credit loansĀ are last chance financing for borrowers whose credit scores are in the dumps. A bad credit loan is useful when it helps a borrower to avoid bankruptcy or helps a borrower avoid the loss of home or car. Bad credit loans are typically short term loans that carry higher interest rates. These loans assist borrowers with poor credit scores that would fail to qualify for a loan from a traditional financing institution like a bank. Borrowers can reduce the total amount of interest that would need to be repaid by paying off bad credit loans rapidly.

Line Of Credit

A personal line of credit is a loan that is granted to individuals that need access to cash and do not want to put up collateral. A personal line of credit is an easy way to borrow because you only have to pay interest on money that you use. You can get credit far greater than the amount that you need and just withdraw the funds as needed. Your line of credit will be replenished as you pay down the balance.