Bad Credit Loans
Everyone comes across a time in their life where they need emergency funds. The problem that many people across America are running in to is the fact that they have bad credit and need a loan. Bad credit loans are becoming increasingly popular as new loan types are introduced such as bad credit title loans and personal loans.
If you are looking for bad credit loans, you have probably realized that many banks don’t offer too many options because they mainly deal with customers with established credit of usually 600+. Title loans are becoming the go to loan for customers with bad credit.
What is a title loan?
Title loans are the perfect option for customers looking for bad credit loans because the main source of determining if the customer will be approved for the loan is the customer’s vehicle. The amount of the loan is based on the vehicle type, mileage, year, and also how much income the customer makes. The income is important when looking for bad credit loans because the lender must make sure that the customer has the ability to repay the loan. If a customer qualifies for a large title loan because of the vehicle type they have but doesn’t make enough income to meet the monthly payments, they wouldn’t be able to receive the loan.
Things to consider when applying for bad credit loans
Another thing to consider when getting a loan with bad credit is the interest rates. Typically, interest rates are higher for customers trying to receive a bad credit loan. This is because the lender has more of a risk when lending the money because there is no credit history to prove the customer will repay the loan. Although the credit is higher on these types of loans, title loans are meant to be a shorter term loan, meaning that the customer should pay off the loan as soon as possible.
The great thing about getting a title loan for customers looking for a bad credit loan is that once the loan is re-payed, there will be a positive impact on the customer’s credit score. If all payments are made on time, and even if the title loan is payed off early, the title loan company can report this to credit bureaus which raises the customer’s credit.
If your credit is low and you are looking for a bad credit loan, be sure to weigh your options before choosing which loan type is best for you. Title loans and payday loans are great options if you can get approved, but be sure that you have the ability to repay the loan. If you have emergency expenses and the problem is going to keep increasing, then your only option may be one of these loan types.
Bad credit loan resources
Finding a title loan location near you should not be made harder than it needs to be. Look through our frequently asked questions about title loans, which will answer all the questions you may have about how the title loan process works.
Already know how the title loan process works but want to know what your monthly payments may be? Try our title loan calculator to see exactly how much of your payment would be going towards the title loan interest and title loan principle.