What are the basic requirements for a personal loan?
You must be between 18 and 65 years old to qualify for personal loans for bad credit. You have to provide proof of a steady source of income. Contact information such as your phone number and email address may be requested and verified by the lender. You may have to submit banking account information, so that they can draft payments when it’s time to repay the loan.
Advantages of bad credit loans
One of the differences between this type of loan and other types of loans is that loan applications processed quickly. These loans don’t require nearly as much as paperwork and red tape as conventional loans provided through banking institutions. You only have to fill out a brief online form to complete the application process. Not having to supply a form of collateral is another advantage of taking out a bad credit loan. Most banking institutions require some sort of collateral. Your credit score is less of a factor when applying for this type of loan. Traditional lending institutions rely on the credit score when considering a loan application. The funds are disbursed immediately within one business day as soon as the application is submitted. You may have a tight deadline, so having the quick cash you need gives you peace of mind.
Evaluating personal loans for bad credit
Is this type of loan for me? When applying for a personal loan with poor credit, you should consider several things. Remember that any loan that you take out is a short-term loan. In general, whenever you take out a short-term loan, you have to make sure that you are prepared to repay the loan back in s short amount of time. Most of the loans function similarly to payday loans. Also consider the fees that come with this type of loan and the slightly higher interest rate.
Costs of the loan
The interest rate is approximately 20 percent or more for most short term loans available to people with bad credit. It isn’t uncommon for the rate to exceed 36 percent for a bad credit loan. You may also be responsible for a flat fee. This fee is usually expected on the first payment. You will also have to pay an origination or administrative fee that could be around 5 percent. The true cost of the loan should be calculated, and the lender will provide you with a detailed description of all the fees.
Flexibility of repayment
Some lenders will work with you if you are stretched financially. You can repay the loan within the time frame assigned on schedule or request an extension. Some lenders may offer an extension. The extension fees begin accruing immediately, and there will be a thirty-day extension for the loan.
A personal loan for people with bad credit is good for people who are confident in their ability to repay the loan with ease. You should be prepared to fill out an online form. Once the information is received, you will be approved on the spot in most cases. You will be required to sign an agreement once the loan is approved. Funds are disbursed within one business day in most cases.