It is no news that, getting a loan with a low credit score is no small task. It could be very difficult, tiring and to say the least frustrating. However, with adequate information, the process of securing a loan with a low credit score could be made less tasking. Find below a list of 6 things you should know to get a loan with your low credit score:
Correct errors on your credit report
While it is often assumed that credit reports are error free, it is quite advisable that you get in touch with your bank to get a copy of your credit report, so that you would go through the document and vet it for errors. By going through your credit report, you could fish out some errors on your credit report, which would thereby improve your credit score. If this is ignored, you might end up paying exorbitant interest rates on the loan(s) you secure with your bad credit score. Also, by going through your credit report you would be doubly sure of your credit score before you start applying for loans.
Loans cost more with a low credit score
If your credit score is not very good, the amount to be paid back as interest rate would be exorbitant, in comparison to the amount paid back as interest rate by another customer who has a better credit score.
Online vendors are a great option for loans
Opportunity to secure a loan with a low credit score abound online, as there is a myriad of reputable loan providers online. These providers include: Avant, Lending club, One Main Financial etc. However, for safety reasons, when searching for loans with a low credit score online, you have to be wary of some loan providers who offer personal loans online, this is because the National Consumer Law Center has found that some pay day lenders charge cut-throat interest rates on the loans they provide. See more.
Conduct a thorough research
To get a loan with a loan with a low credit score, it is advised that proper research be made. Ask your friends, neighbors, and colleagues for advice on which of the loan providers should be approached. Meet agents of loan providing companies to see if your needs could be met by the service they provide.
Compare personal loans online
Contrary to popular opinion that a low credit score automatically means a hefty interest rate, it has been found out that the interest rate charged by loan providers varies. Therefore, to avoid been over-charged, it is best to gather information about the interest rates of the various loan providers you have met, compare the rates and opt for the loan provider with the least interest rate.
Approach your bank
While an interest rate of about 30% is often charged by most loan providers, you would find it interesting to know that your bank could provide you a better deal. So, instead of paying some hefty amount as interest rate to some loan provider, approach your bank or credit union with plausible reasons or explanations for your need of the loan. To find out more, check out https://www.everyday-loans.co.uk/bad-credit-loans