Installment Loans For Bad Credit
If you have less than perfect credit, this is where you should start. Fill out the short and secure form below. Have an answer in just minutes. Theres is no obligation and getting a quote is of course, completely free.
If you need a small dollar amount and have bad credit, a payday loan might be for you. It is probably the easiest loan to get but comes with some very serious drawbacks.
Short Loan Terms
First, you have the short loan term. Most loans will be due within about two weeks. Lenders design the loan to come due on the borrowers next payday. It allows them to swoop in and grab their money just as soon as the persons paycheck hits their bank account.
The problem with such a short term is that most people will not have the time to get finances in order. It also means that a large portion of their next check will go towards paying back the loan and the fees that come with it.
Because you are missing a huge portion of your next check, borrowers will typically come up short before their next payday. So, what do they do? They take out another payday loan. This is how people get caught in a payday loan trap. Watch out.
This is the biggest things that payday loans come under fire for, high loan fees. The fees will vary quite a bit depending on the lender but a typical fee might be something like $20 for every $100 borrowed. So, a $200 loan for example, would have $40 in fees.
Since these are loans for people with bad credit, on the surface, this may not sound too bad. After all, the fee is just 20% of the amount borrowed and you need the money.
The problem comes when you figure out the actual interest rate. 20% is not it. Take the loan term into account and the actual interest rate you are paying will be somewhere between 400% and 600%.
When you look at it that way, the money charged for a payday loan is crazy. This is why they are banned in many states and regulated in others.
Car and truck loans for bad credit are out there as well, If you need a vehicle, you can usually get a loan no matter what your credit looks like. It just depends on what you are willing to pay.
High Interest Rates
Interest rates for poor credit can be around the 30% range. This is a huge rate. On a $10,000 loan, if you financed it for 5 years at that rate, you would pay $18,0000 in interest. Stretch that same $20,000 loan out to 6 years and you would pay over $23,000 in interest. So, a $20,000 car would end up costing you over $43000.
High Down Payments
With bad credit, a zero down loan might not be in the cards for you. Your lender will often want a high down payment to minimize their risk.
When you take a car off a lot, even a used one, it depreciates. This means that if you were to default on a loan, a lender could not repossess and sell your car for what you still owe. Unless of course, they get you to put more money down.
The more money that you put down, the lower the LTV or Loan To Value ratio and the less risky the loan is. If your credit is really bad, you might need to put down as much as 20%.
Buy Here Pay Here
With really bad credit, your only option might be a “buy here pay here” dealership. You are probably going to get taken in several ways at a place like this.
First, you are going to pay high interest. By the time the loan is paid off, you will easily pay over twice the purchase price because of interest.
In addition, the purchase price itself will probably be inflated. The dealers at these lots know that you have limited options. Limited options mean limited negotiating ability. They will probably be very unlikely to lower the price on a vehicle thru negotiations. Also, the initial asking price will often be above blue book value.
Lastly, there will probably be a GPS locator somewhere in the vehicle and they will be quick to repossess it. Don’t miss any payments.
There are government loan programs that will help you with purchasing a home with bad credit. The one that you will be of interest to mot is the FHA loan program. With an FHA loan, you can get a home loan with a score as low as 500. The catch is the down payment and the mortgage insurance.
The starting down payment for an FHA is 3.5%. To put that little down, you need to have at lest a 580 credit score. For a home loan, 3.5% is not a bad down payment. It means that a $200,000 house would have a down payment of $7000. Of course, if you have bad credit, do you have $7000 just laying around? Probably not.
If your score is lower than 580, you will need to come to the table with more money, closer to 10%. That is $20,000 on an average $200,000 home and that gets a bit tricker to come up with.
The other catch with an FHA loan is the mortgage insurance. You will have to pay an annual mortgage insurance which will add, on average, several hundred dollars to your monthly payment. You will pay that mortgage insurance for the life of the loan if you put less than 10% down at purchase. If you paid more than10% down, mortgage insurance will drop after 11 years. The only other way to get rid of it is to refinance your loan.
Getting Personal Loans Up To $50,000
Once again, this is the main thing that our lenders give you access to no matter what your credit looks like. Even if you have bad credit, if you need a loan, you are free to get a quote by using the form at the top of the page. Here are a few of the things our lenders are looking for.
You can counter bad credit with stability. This applies to both how you live and where you work. A borrower who moves around all the time and changes jobs every 6 months is a bad risk.
On the other hand, if you have lived at the same address for over 2 years and have worked for the same company for 5 years, you are a much better risk. The lender at lest believes that they will be able to find you and that you will continue to have money coming in.
No Loan Defaults
You can have bad credit and still be reliable if you have never defaulted on a loan. If another lender has written off a loan that they had with you, why would a new lender expect a different outcome.
Steady income is the name of the game. Lenders need to know that you will have money coming in continually. It does not even have to be a job, it could be just money that you receive regularly. This could be child support, a structured settlement or just about anything. As long as you get it on a regular basis, it can be used by the lender.
In addition, the amount that you make will affect how much you can borrow. The more you make, the more the lender will feel that you can afford to repay.