Traditional lenders react very predictably the second they see a loan application come across their desk with a less than perfect credit score.
That application gets denied with lightning like speed and shuffled off, often into the wastebasket faster than anyone could have expected.
Luckily, though, the alternative financing world today is changing landscape of lending completely.
It’s easier today than ever before to get bad credit loans with guaranteed approval, especially if your credit is nonexistent, less than perfect, or spotted with all kinds of blemishes over the years.
The trick, though, is finding these bad credit loans with guaranteed approval that are worth investigating while avoiding offers that seem too good to be true (and end up being exactly that).
Let’s dig a little deeper into what you need to know to find great financing without top-tier credit.
How to Find Great Bad Credit Loans with Guaranteed Approval
It’s not hard to find companies offering bad credit loans with guaranteed approval.
It’s not difficult at all.
In fact, a quick search will probably turn up dozens and dozens of companies offering you these kinds of loans. Many of them promise unbelievable interest rates and fantastic repayment terms, too.
Dig a little deeper, though, and you’ll discover that many of those offers are a lot less exciting when you crunch the numbers than they are at first glance.
To sift through your options and find great bad credit loans with guaranteed approval here are some important things to focus on.
Interest rates are a huge piece of the puzzle to finding great bad credit loans with guaranteed approval.
It’s not uncommon for loans offered to those with less than perfect credit to be attached to skyhigh interest rates. People desperate for money (especially in an emergency) often agree to pay pretty much anything, just to get relief for the assistance they need right then.
Legitimate alternative financing options today, though, do not do this to their customers.
Instead, they offer bad credit loans with guaranteed approval that are attached to relatively favorable interest rates. They might not be the same interest rates offered to people with perfect credit, but they are leaps and bounds better than those offered by fly-by-night operations in this industry.
Terms and Conditions
Loan terms and conditions are where less than legitimate operations bury all kinds of fees, surprise charges, and other unpleasant details hoping that their customers looking for quick cash aren’t going to read anything other than headlines.
Make sure that doesn’t happen to you.
Take the time to review all terms and conditions, especially for loans advertise specifically as guaranteed approval for those with bad credit.
Make sure that you know that your interest rates are fixed (or are variable rates you are comfortable with). Make sure you know exactly what your repayment schedule looks like. And make sure that there aren’t any prepayment or early payment penalties, either.
Different companies offering bad credit loans with guaranteed approval may have different eligibility requirements.
You might see an ad for guaranteed approval, but only for folks with:
- Active sources of income
- Decent credit (lower than 600, but close enough)
- The ability to repay terms on very short notice
Sometimes these guaranteed approval offers will be attached to skyhigh interest rates, too. Just make sure to run through any specific requirements to verify that you are comfortable.
Lastly, it’s a good idea to look at the repayment options available.
For one thing, you need to know what your repayment schedule is going to look like.
Are you going to be making regular installment payments?
Maybe once a week or twice a month?
Do you have to pay the whole lump sum at the end of the loan term?
Are you able to prepay in advance and save money long-term?
Is there some kind of penalty or fee for that approach?
All of those questions (and more) have to be answered before you can move forward.
How Good Does My Credit Need to Be?
Obviously, different people have different ideas of what “bad credit” really means.
A lot of traditional banks and credit unions consider bad credit to be anything south of 650 (or maybe even higher than that). Nontraditional lenders might consider bad credit anything to be under 600, 575, or have no real limit to how low a credit score can go.
Still, you want to make sure that lenders aren’t using “bad credit” as weasel words to get around offering true guaranteed lending packages. Do your research and due diligence and you’ll be good to go!
Will I Need to Use Collateral to Secure These Loans?
Finally, it’s a good idea to see if you need to use collateral to secure these otherwise guaranteed loans.
A lot of people go into bad credit loan situations thinking that they’ll be able to get guaranteed approval on unsecured loans. The reality, though, is that many of these guaranteed offers require some form of collateral to be put up to lock them in place.
Not all of them, but many of them follow that kind of protocol.
That’s definitely something to look into.