We all have enough responsibilities to stress about on a day-to-day basis; the last thing we should have worry about is our credit score and not getting the financing we need when we need it most. Personal loans are a fast, easy short term cash loan where you can borrow anywhere between $100 and $1000, depending on how much you qualify for. The truth is, finding a lender that offers personal loans for bad credit can be hard to come by. The lower your credit score is, the harder it may be for you to find a loan you can qualify for.
Where to Get Personal Loans for Bad Credit
You might be wondering, “so, where can I get a personal loan if I have bad credit, and will I really qualify?” Although getting a personal loan with bad credit can be a bit stressful and may require a little extra effort, it is not impossible!
When you are ready to apply for your personal loan, the lender will begin by reviewing your credit history, income and overall financial information to assess you as a borrower. They use this information to decide if you are qualified to take out a loan, and what your interest rate will be. Typically, the lower your credit score, the less money you can borrow and the higher your interest rate will be.
If you are having a difficult time getting approved for a personal loan from a lender because of your poor credit score, it is still recommended that you stay away from payday loans and auto title loans. At Tio Rico we offer financing solutions and personal loans for those of you who suffer from bad credit. Our highly trained financial team possesses the right tools and knowledge it takes to get you in front of the personal loan you need, today.
Pros and Cons of Personal Loans With Bad Credit
Like any financial solution, personal loans for bad credit come with both advantages and disadvantages that you’ll want to consider before taking out your loan.
Helps Consolidate Debt
A major benefit of a personal loan is its ability to help you consolidate debt. With personal loans, you can decide how you want to use the loan. The fixed interest rates, and a generally lower interest rate and more borrowing power than with a credit card, makes budgeting for your loan payments easier and can help cure high-interest credit card debt. Taking out a personal loan can help you get back on your feet and get organized, consolidating multiple payments to one monthly payment.
Although qualifying for a personal loan with bad credit can mean having high-interest rates, there is a big advantage if you pay it off correctly. If you are able to successfully consolidate your debt, pay off your debt, and make your monthly payments on time, your credit score can experience a drastic improvement. Improving your credit score will make buying a home, car, or any other big purchase much easier in the future. It’s important to keep up with your monthly payments in order to improve your score, and not hurt it.
Higher Interest Rates
The biggest disadvantage of getting personal loans with bad credit is facing higher interest rates. The interest rate could very well be higher than mortgages, home equity loans, auto loans, and even student loans. The reason for this is that lenders look at personal loans, especially personal loans for bad credit, as a higher risk than those other loans. Having a personal loan with a high-interest rate could mean that you will pay a significant amount more of money over the life of the loan.
The important thing to remember about taking out a personal loan is to always keep your spending in check. If you have gotten in a bad habit of overspending, or even encounter a bad financial situation where you’re unable to make your loan payments and pay the interest, you could end up in even more debt and default on your loan. As a result, you will severely damage your already bad credit, making it nearly impossible to qualify for other loans.
So when you’re in need of cash, fast, we have the best personal loans for Arizona, California, and New Mexico residents, here at Tio Rico. If you are looking to go on a family summer vacation trip, or need a little extra help paying your bills but have a low credit score, a personal loan from Tio Rico may be the perfect solution for you. For more information, give us a call or visit us at one of our friendly locations, and see how we can get you a great rate on your personal loan today!