How and where can I get a loan with a bad credit history?
Installment loans online for bad credit: if you have never taken a single loan in your life, your credit history is completely empty. If you took loans (no matter how much, when and where), and repaid them on time – your credit history is clean, and in the eyes of any financial institution you are a trustworthy client.
But it also happens that there were problems with the repayment of a loan. Each negative case is reflected in the credit history. And if you need to take out a loan again, there may be problems.
Why is it difficult to get a loan with a bad credit history?
A credit history is a kind of “medical record” of a client, which reflects all of his loans (where, when and how much was taken). Also in the credit history are indicated and information about how the customer extinguished loans: on time? Is it full? No conflicts?
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Any negative case is a signal to the bank: this client has had problems in the past. This automatically complicates the design of a new loan. Many banks immediately refuse a new loan to individuals who have had any problems in the past. Others are ready to issue a loan, but the conditions will be even tougher and worse than for the “ordinary” borrower.
What can credit history deteriorate?
Credit history may deteriorate for the following reasons:
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- A large number of loans in the past, and / or 2 or more open loans. Even if a person has a high and stable income, even if he extinguishes all loans and extinguishes in a timely manner. A large number of loans means that a person has a need for money, and that either a loan is the only way to get them, or he takes loans without hesitation.
- Submission of a large number of applications in different banks. Not only taken credits are entered into the database, but also applications submitted (both submitted to the department and sent through the websites). If a person sends several applications to different banks at once, for some reason it implies a refusal. In fact, you will not be denied a loan only because of the large number of applications, but you can check in more detail, or conditions will be assigned less favorable.
- Overdue on previous loans. It doesn’t matter why the client didn’t make a payment on time: the salary was delayed, the transfer went too long, or he was deliberately hiding from creditors – a negative mark would still appear in CI. They do not install it right away – if the client is late for a payment of 1-2 days, the bank representatives will first contact him. If he makes contact, he will explain the reason for the delay, and in the coming days he will make a payment – they will not make a note in CI.
- Early repayment of the loan. If you have taken a loan in the past and repaid it earlier – this also makes you not an ideal bank customer. Indeed, in case of early repayment, the bank receives less interest on interest.
- Participation in foreign loans as a guarantor. If a person for whom you are a guarantor, for some reason does not pay the debt – you will have to repay it. Therefore, even if you do not have “your own” loans, but for some of your relatives or friends you act as a guarantor – this also spoils the CI.
- The trial against the bank. If in the past this situation was – the credit history will be corrupted regardless of the outcome and of who is right and who is to blame.
- An important caveat: financial institutions will never understand the intricacies of why there are some black spots in your credit history. They assess the situation by just 2 criteria: either the credit history is clean, or the credit history is corrupted, without any details.
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By the way, the complete absence of credits can influence the credit history. A client who has never taken loans is more unpredictable and untested than someone who has already taken a loan and paid it off normally. Of course, the credit history of the new client is not spoiled, but they will be more cautious about it.
Is it possible to “fix” a credit history?
Yes you can.
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The easiest way is to take a new loan and repay it without any problems (without delinquency, without early payments). It does not have to be a large amount taken for several years: credit history can even fix a microloan taken for 1-2 months.
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The reason is that when considering an application, a financial institution first considers information on the latest loan. Then the data for the last 5 years is taken into account.
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The problem is that a loan with a bad credit history can either not be given at all, or given, but under less favorable conditions (at a higher percentage). Therefore, in order to “correct” credit history, it is worth choosing short-term loans.
Will they give a loan with a bad credit history in the bank?
The decision of the bank depends on the situation.
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If the client has an open loan for which there are problems, he will most likely be refused. It is less likely, but possible, to approve an application with a higher interest rate and a reduced loan amount.
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If the client does not have open credits, and the black spots in credit history are in the past, then the forecast is the same, only the loan is more likely to be approved.
What problems will a client face who wants to get a loan with a bad credit history in a bank?
If a person has a damaged credit history, he may encounter such problems:
- May refuse a new loan;
- If a new loan is approved, the conditions on it will be more stringent: the percentage will be higher, the repayment period is less, the amount issued will also be less.
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Also, problems in credit history can negatively affect employment. Some employers check their credit history when hiring new employees. This is done to verify the integrity of the applicant. They are usually carried out when looking for an employee for positions related to finance.
What companies give loans with bad credit history?
The bank is not the only organization that provides loans. You can also get a loan in the payday loan.
Microfinance organizations on the principle of operation are significantly different from banks. They lend small amounts: on average, up to 5-10 thousand, less often – a little more. The maturity of the debt is also less than in banks – most often it does not exceed 30 days, less often – it can reach up to 45-60 days.
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Since the amount and maturity in payday loans is much (many times, or even tenfold) less than in banks – such companies can easily issue loans even to those clients who can return them with problems. This is possible for the following reasons:
- The payday loan risks a relatively small amount (as opposed to a bank that issues only large loans);
- The payday loan will quickly understand that the client is delaying the return – because the maturity of the debt is short (which means it will be possible to take action quickly).
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True, the payday loan will also check the client’s credit history. But even there are some negative aspects in it – the microfinance organization is ready to turn a blind eye to them, and still provide a loan.
What you need to get a loan with a bad credit history?
Microfinance organizations make far less demands on their clients. In this regard, they compare favorably with banks, where you will be required to have a whole list of papers and certificates, as well as compliance with several important conditions (among which is the “purity” of CI).
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To get a microloan in an payday loan, you will need an original passport and TIN. As for the requirements, they concern only the age (usually from 18 to 60, but some payday loans are ready to give money to older clients).
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An application for the issuance of money can be submitted either at any of the payday loan departments (if it has real branches), or remotely – through the website. The second option is more profitable because it allows you to get a loan at all without leaving home.
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Regarding the issue date: on average, the whole procedure takes up to 1 hour even for a user who has never done this and is not familiar with the computer. If the client has already taken the money, and the second (or subsequent) time comes to the same payday loan, he can receive the money in just 10-15 minutes (since he will not have to be re-checked, confirmed the card and passport data).
Where can I get a loan with a bad credit history in USA?
In USA, it is possible to get a microloan to a person with a bad credit history in payday loan Best payday loan. The company is one of the most famous and reliable in the field of microcredit.
Personal installment loans for bad credit are available in cash (in any of the branches operating in 9 regions of USA), or send a transfer to a card. When you first apply, we are ready to approve an amount of up to 500 $, with a maturity of up to 30 days. If you contact us again – the repayment period will increase (maximum – up to 65 days).