When you need a personal loan and know that your credit is less than perfect, you may feel that you’re out of options. Despite having a bad credit score, you may still apply and receive a personal loan, but it can yield results that are less desirable or difficult to pay off.
If you plan to use a loan to pay off debt, you could improve your credit score and eliminate debt at the same time. Getting a personal loan for debt consolidation is a good start to getting out of debt once and for all. However, understand that your credit score will impact the terms of a personal loan, so choose your lender wisely. Learn how you can get a personal loan with bad credit by following the steps below.
Assess Your Current Credit
The first step to getting a personal loan with bad credit is to know where you stand. Lenders use your credit score to determine the risk you pose as a borrower, as well as the likeliness that you will be able to pay back the loan. You can still apply for a personal loan and be approved, but you may have higher interest rates and a lower amount issued. This may not be a wise decision if you know that interest rates could be more than you can afford. Remember to check your credit score first to know where you stand. Then consider taking steps to improve your score before taking out a personal loan.
Improve Your Credit Score
Start improving your credit score by paying off debts regularly. This will help establish your payment history and increase your chances of receiving better terms. There are several factors that go into your credit score, but this one is the biggest and most significant. Another way to improve your credit is to monitor your statements for inconsistencies or errors. Lastly, you can also reduce the number of hard inquiries you put on your credit score. Taking out too many loans, opening credit lines, or asking for a full credit report creates a hard inquiry that can lower your score.
Get a Debt Consolidation Loan
Instead of taking out a personal loan with bad credit and risk falling deeper into debt, consider talking to a lender that offers personal loans for debt consolidation. A debt consolidation loan combines your debt into one account and has easy to manage monthly payments. With lower fixed interest rates on your loan, you can make repayments regularly and on time. Not only will you pay off debt, but you will also improve your score simultaneously!
If you have questions about debt consolidation loans, speak to our team of knowledgeable professionals. Our compassionate loan matchmakers will find the best terms tailored to your unique situation with fast approval and rates starting as low as 3.84% for amounts up to $100,000.
Get started today on our website. Prefer to talk in person? Call us at 833-453-6324 and we’ll get you connected immediately with one of our loan experts.