Essential Fact About Taking Bad Credit Personal Loans?

A lot of people think that people with bad credit are restricted to take a loan. The truth is that there are a lot of options for borrowers with bad credit. If you are going to search online, you will find numerous moneylenders and each of them offers enticing credit loans. Basically, moneylenders appreciate borrowers with good credit rating. What if you are a bad credit rating or a not so perfect credit score? Does this mean you are restricted from filing a credit loan? In this article, we will discuss some of the available credit options for people with bad credit and what its advantages are.


With the advent of the internet anybody can now apply for personal loan regardless of the credit rating. However, you should meet the requirements set by the moneylender for you to be eligible in taking credit loans. The basic requirements are:

  • The borrower should be 18 years old and above
  • Provides proof of citizenship
  • Present 2 valid identification cards
  • Must be currently employed and submit certificate of employment
  • Must be able to present proof of income for self employed borrowers

People with bad credit can apply for personal loans in two ways:

Secured personal loans

In this type of loan, the borrower should present any valuable items that serve as collateral. If you have a car, home, land, or anything of greater value, you can use it as collateral. As a matter of fact, there are money lenders that accept jewelries and expensive porcelains. With secured personal loan, the lender does not take into account your credit rating. As long as you meet all the aforementioned requirements, then you are good to go. However, the amount that you will be able to borrow solely depends on the total value of your collateral. The primary advantage of secured personal loan is that you are given a relatively lower interest rate. If you present collateral, you will be identified as safe borrower and as a return the lender only offers minimum interest rate. However, you should be able to pay the loan within the stipulated period of time or else your collateral will be at stake.

Unsecured personal loans

What if you have a bad credit score and you don’t have valuable items to use as collateral? Does this mean you are not a candidate for personal loan? If you have a bad credit score and you don’t also have any valuable items for collateral, then you don’t have to lose hope because there are a lot of moneylenders that are willing to lend you money. You will automatically belong to unsecured personal loan, which identifies you as a risky borrower. As a result, the lender will impose a relatively higher interest rate. This is to make sure that you will be updated on paying the loan.

What if you fail to pay the loan within the stipulated period of time?

As a borrower, it is your responsibility to pay the loan within the stipulated period of time. In the event that something unusual happened or if you think that you will be unable to repay the loan within the stipulated period of time, then all you have to do is to contact the lender beforehand. The lender can make payment arrangement, which can be beneficial for the both parties involved.

Personal loan is helpful, especially in times of financial emergencies such as hospitalization, bill payment, tuition fee, and the like. In situations like these, you can depend on your friends and relatives but if none of them are willing to help, then do not worry because moneylenders are there to help you.

Author Bio : Rey Anthony Jones is an expert credit loans writer. He gives relevant information about the different types of credi loans available for people with good and bad credit score.

Vijayraj Reddy is founder & editor-in-chief of, a financial blog which helps people to earn money, invest money and save money.

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