Very Bad Credit Loan

Having very bad credit can seriously limit a person’s options for borrowing money. Many banks and traditional lenders will automatically any loan application from a person with very bad credit. Payday and instant lenders will loan to persons with very bad credit but their loans come with strict terms and high interest rates.

Some nontraditional lenders including many online lenders will loan to people with very bad credit if they can prove they a steady source of income. A steady source of income can be a good job, a government benefit, a pension or a business with good cash flow.

These lenders will usually demand quick repayment of loans or cash advances. Some of them will want repayment within two weeks or on the borrowers’ next payday. Others will extend the period of loan repayment for a fee.

Secured loans with very bad credit

One source of alternative lending that people with very bad credit maybe able to take advantage of is secured loans. Lenders will make these loans to people with very bad credit because they up collateral which the lender can seize to secure the loan. Secured loans often come with lower interest rates and better terms than cash advances.

A good source of secured loans is pawnshops which lend money on a wide variety of articles including watches, jewelry, guns, collectibles, coins, motorcycles, cars, electronics and tools. Pawnbrokers will lend to people with very credit because they put up collateral.

The amount of money made on secured loans is usually limited by the value of the item. The amount of the loan is usually less than the value of the item so the pawnbroker can make a profit if they have to sell the item.

Online loans with very credit

Many online lenders will lend to people with very credit if they have a bank account and a verifiable source of income. The online lender requires a bank account because they deposit the money borrowed electronically into the borrower’s bank account. Most online lenders will require that the person allow them to withdraw the loan repayment amount directly from their bank account.

Other loans with very bad credit

It is possible for a person with very bad credit to get a credit card or similar line of credit. Unfortunately, credit card companies will usually only give people with bad credit a limited amount of credit.

Many credit card companies will charge a person with bad credit a very high interest rate and charge them a $60 or $100 fee to get a credit card with a $350 limit. This is obviously a very bad deal that can cost a person a lot of money. Secured loans and cash advances are better loan options for people with very bad credit.