Bad Credit Personal Loans Guaranteed Approval
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Bad Credit Personal Loans with Guaranteed Approval, Do They Exist?
Well, the answer is complicated! Yes, there are direct lenders that allow you to take up loans even if you have a bad credit score. But, if you stress on the “Guaranteed” aspect of the loan, the simple answer is a NO!
No, lenders do not offer you a guaranteed emergency personal loan approval (or even payday loans of that matter).
Most people confuse “instant loan” for guaranteed payday loan approval. But, in reality, these are two different things.
When lenders mention instant loans on the application form, they are most probably referring to their instant decision loan. Under such types of payday loans, lenders usually do not perform a hard check on your account to avoid informing your credit bureaus and provide an instant loan.
Nonetheless, there are a generous number of lenders that are willing to provide bad credit loans with specific requirements. The best solution is to keep looking for lenders whose eligibility criteria fit your requirement profile ideally and score a good deal.
Or, you can simply start from scratch and work on improving your credit score.
Requirements of Personal Loans with Bad Credit
There are three main types of emergency loans that you can apply with bad credit scores – payday, installment, and personal loans.
Amongst the three, personal loans provide the best solution if you want to borrow a substantial amount. Lenders can offer up to $35,000 personal loans with bad credit, as opposed to just $1000 for the conventional payday loans.
Thus, the list of requirements may also be higher for personal loans as compared to installment or payday loans. However, the basic requirements of applying for personal loans with bad credits include:
- You must be at least part-time employed with a legitimate monthly income of at least $2000 pre-tax.
- You must be at least 18 years. But, the recommended age is 21 or above.
- A valid ID proof.
- A valid Bank account.
Improve your Credit Score and Increase Your Loan Option
If you are looking to apply for a payday loan or even personal loan, you cannot undermine the importance of your credit scores. It makes all the difference in the world!
Your credit score can determine the fate of some of the most crucial aspects of an emergency personal or payday loan, most notably your chances of getting it approved and the interest rates.
In general, most lenders maintain a threshold of 520 credit points to offer emergency personal, installment, or payday loans without any complications. Unless you are applying for a no credit check payday loan, if your credit score is lower than the threshold value, your chances of loan approval are usually very low.
But, there are lenders that can go down as low as 400 credit points. Once your score slumps below that figure, you run the chances of not getting your loans approved. Even if your loan gets approved, if your credit score is low, lenders usually impose high-interest rates.
So, in order to ensure yourself a simple and pain-free loan option, you need to maintain a good credit score.
How to Improve Your Bad Credit score
Avoid hard check
In some cases, unless you’re applying for a no credit check payday loan, lenders give you the option to choose between a soft and a hard check to verify your credit history.
A soft check refers to the process of verifying your account without your consent. Lenders can usually run a brief overview of your accounts to verify the legitimacy of your credit account. In such cases, your credit scores do not matter. Hence, your payments do not get reported to your credit bureaus.
A hard check, on the other hand, includes conducting an in-depth check on your credit history as well as a bank account. It is usually conducted after your account qualifies for a loan.
In such cases, your credit scores are taken into account as such direct lenders communicate with your credit bureaus to verify the same. Under such circumstances, your credit score reduces by a significant number.
Thus, always try to avoid hard checks when you apply for emergency personal or payday loans.
Pay your bills on time
The simplest and also the easiest way to make sure your credit scores do not go downhill is to ensure you pay your monthly bills on time before the due date. Especially those bills that go directly through your credit bureaus.
These can include your monthly payments such as credit card bills, car loans, study loans, mortgages, etc. If you’re consistently late on your monthly bill payments, it can have an adverse impact on your credit scores. Usually, the threshold time is 30 days.
So, once you’re 30 days or a month late on your bill payments, you can expect your credit scores to fall by a significant figure.
Apply for a secured credit card
If you are a newbie to using credit cards and is looking to kick-start your credit history on the right foot, a secured credit card is your best option. A secured credit card is specifically helpful for people with either low or no credit score.
In the case of secured cards, you initially start out by making a cash advance/deposit. So, instead of relying on your credit card bureaus, you use that amount as your credit limit in the initial phase.
Since you’re technically not creating any debts towards your credit card bureaus, it creates less risk for them and also allows you to use the credit card whenever you want.
As such, you can build up your credit score with minimal risk, which later helps you obtain the maximum result.
Consolidate your balances
Instead of using multiple credit cards to apply for loans and create debts, try to consolidate your debts only to one card. Your credit card bureaus will usually check the number of cards that have debts. If you have significant debts piled on multiple credit cards that lower your overall credit score.
Try to clear out the small debts to minimize your overall debts and also to boost your credit score. Consolidating your balances onto a single card will reduce your interest rate (ideally) and help you maintain an ideal debt value to 30% of your credit limit.
Summary – Bad Credit Loans Guaranteed Approval
If you are struggling with a bad credit score, you do not need to panic! There are ample direct/connected lenders in the market that helps you get loans even with bad credit scores.
Although, if you’re looking for “guaranteed” approvals, you won’t find one! No lenders can guarantee bad credit loans, as there are numerous factors to take into account.
But, with so many lender options in the market, you might just find one that ticks all the right boxes. So, just keep looking!