Building or restoring one’s good credit standing may take some time. So if you do need a loan for whatever reason, repairing your credit history will still be the only surefire way you can get approved for a loan. But why do you have a bad credit history? These could be just some of the reasons why:
- Unpaid bills
- Existing, unpaid loans
- Foreclosed property
- Unemployment
- Active but unused credit card
To be totally honest, the best way to get approved for a loan is to fix your credit record This means paying your bills on time, finally paying back your existing loans, and making sure you’re saving enough from your salary.
But desperate times call for desperate measures, am I right? Well thankfully, you don’t always need to go through that route if an emergency does happen. However, let me warn you right here: this must be your last resort. Take out a loan only if you have an intention of paying it back. Or else you may never be able to recover and drown in your own bad decisions.
With that in mind, I’m still here to help you out. So here are a few places where you can score bad credit loans:
- Online Private Lenders
With the advent of digitized banking comes the entry of online private lenders that can take the risk of shelling out funds for people with bad credit and has therefore created a lifeline for those who need it most. It’s perfect for someone who needs just a little bit more money quickly because most of the time, they only lend a relatively small amount as compared to big banks that can grant up to millions of pesos.
- Pawnshops
If you have that heirloom piece of jewelry you were saving for a special occasion while you’re out going hungry, perhaps it’s time to make good use of that sentimental item and trade it off for cash. If you can bounce back from that, maybe you’ll still be able to get it back. Aside from jewelry, you can also pawn off gadgets like laptops, cellphones, and even fancy cameras.
- Have a Guarantor
If you need a bit more cash than what online private lenders can give you, then try applying for a loan with a guarantor or co-signer. This person will be responsible for the loan, in the event that you couldn’t pay for it yourself. Normally, I’d say it’s a good piece of advice to deny anyone who asks you to be a co-signer because you’re risking your good credit standing or could leave you with debt. So be sure to get someone who trusts you. And be doubly sure you won’t be abusing their trust. Remember, it only happens once.
- Use Collateral
If you have an unused car or property lying around and you need to keep yourself liquid, there is a way for you to apply for a loan with banks and even the government. You could use your high-value item as collateral for a personal loan. Again, the thing to do here is to be sure you can repay your loan, or you’d risk losing these valuable items.
- Join a Credit Union
Credit unions are small lending organizations setup to help their members with financial burden. You can often see them serve as savings cooperatives that hand out loans to their members. Although they do offer loans to the public, it’s easier and much more convenient to borrow money from them if you signed up.
- Take on Informal Loans
Aside from joining a credit union, other informal loans are the 5-6, which has crazy interest rates, and borrowing money from a friend or a family member. Take these as the very very last option because it doesn’t always end up well. It’s also kind of hard to be indebted to your relative and friend because it can put a strain on your relationship. But if you’re sure you can pay him or her back within the set time, go right ahead.