In the financial market, being tagged as a risky borrower is the worst it can get. With such a label, it is very difficult for borrowers to take up loans at lower rates. But this should not dishearten the bad credit people because there is still an option open to them. Bad credit loans act as a perfect support system for people with bad credit history.
Getting to know about the credit history is the most important thing for a borrower. This is done by getting a score from Fair Isaac Credit Organization. FICO score ranges from 350-800. A score of more than 720 is considered good credit whereas a score lower than 600 is considered bad credit. The borrower may also be involved in cases of default and late payments, arrears, bankruptcy or county court judgments. If you do not know your credit score you can get it calculated by any of these credit rating agencies i.e. Trans union, Experian or Equifax.
A bad credit loan can be taken up for any purpose like wedding, education, debt consolidation, college education etc.
There are two ways of obtaining a bad credit loan: secured and unsecured. A bad credit loan is secured by pledging a security. Comparatively lower rate and longer repayment term is obtained via this method. However unsecured form of bad credit loans does not require any collateral to borrow money.
A proper documentation is required with bad credit loans. These include the credit report, income tax returns, bank statements, and details of property in case of secured loans. Depending upon the credit history and the repayment capacity, an amount of a range from ₤5000 to ₤75000 can be borrowed.
Online research is the best option to apply for bad credit loans. They help in obtaining competitive rates of interest.
Repayment of a bad credit loan is done in 5-25 years. A shorter duration would certainly help reduce the financial burden of the borrower as less money is paid off as interest. Further more, timely repayment of the bad credit loans would certainly improve the bad credit history of the borrower.
Bad credit loans have proved to be a great respite to people who have a bad credit history and are in a great need of funds to over come their financial needs.
Getting to know about the credit history is the most important thing for a borrower. This is done by getting a score from Fair Isaac Credit Organization. FICO score ranges from 350-800. A score of more than 720 is considered good credit whereas a score lower than 600 is considered bad credit. The borrower may also be involved in cases of default and late payments, arrears, bankruptcy or county court judgments. If you do not know your credit score you can get it calculated by any of these credit rating agencies i.e. Trans union, Experian or Equifax.
A bad credit loan can be taken up for any purpose like wedding, education, debt consolidation, college education etc.
There are two ways of obtaining a bad credit loan: secured and unsecured. A bad credit loan is secured by pledging a security. Comparatively lower rate and longer repayment term is obtained via this method. However unsecured form of bad credit loans does not require any collateral to borrow money.
A proper documentation is required with bad credit loans. These include the credit report, income tax returns, bank statements, and details of property in case of secured loans. Depending upon the credit history and the repayment capacity, an amount of a range from ₤5000 to ₤75000 can be borrowed.
Online research is the best option to apply for bad credit loans. They help in obtaining competitive rates of interest.
Repayment of a bad credit loan is done in 5-25 years. A shorter duration would certainly help reduce the financial burden of the borrower as less money is paid off as interest. Further more, timely repayment of the bad credit loans would certainly improve the bad credit history of the borrower.
Bad credit loans have proved to be a great respite to people who have a bad credit history and are in a great need of funds to over come their financial needs.
Article Source: EzineArticles
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