How to Get a Loan When You Have Bad Credit

Unfortunately, for many having bad credit is a part of everyday life. Mistakes and unfavorable circumstances happen, such as hospitalizations, job loss, and repairs needed around the home. These situations can place you behind on your bills, and late payments will reduce your credit score. This doesn’t make you a bad or irresponsible person, but it does reflect negatively on your credit report. If you have bad credit and are in need of a loan, check out the below four ways to get the loan you need.

Use the Equity in Your Home

If you own a home or condo, check and see if you have equity in your property. If so, you could get a tax deductible line of credit and use that to spend how you wish. A home equity line of credit does not require you to have a credit check. You just need to prove to the bank you can repay this additional loan, so having a reliable source of income is necessary. Just be careful with this type of loan since you will be placing yourself in deeper debt and putting your home on the line.

Apply with a Co-Signer

Many people take loans from family and friends and end up at war with each other. It’s a battle of when you are going to pay that person back or what happens if they see you making other purchases?

A way around this is to have a binding contract, and what better way than to ask your friend or family member to co-sign on a loan for you. There is still risks associated with this, such as if you default on the loan and the lender comes after them. However, they don’t have to come out of pocket with any money. If you are a responsible individual and they know you are in need of this money, this is a viable solution. This could be a win-win for you both, as if you make your payments on time, you’ll increase both of your credit scores.

Remember, Money Talks

If you’re borderline with your credit, it’s possible you can convince the lender to give you the loan if you have an above average income. There are some financial institutions that go through a more rigorous underwriting process. They can pull your report and look into the background specifics, such as why your score truly is low. If your income is up to par, you may be eligible for the loan. To the lender, it’s all about getting their money back – money does talk.

Take a Short Term Loan

If all of the above are not viable options for you, there is still another way out. Short term bad loans have a bad reputation. However, these loans for people with bad credit have bailed out thousands every day. You should only take one if you know you have the means to pay it back timely, or else you’ll fall into the loan trap. These loans have extremely high interest rates, so do be careful. You don’t need credit at all for a short term loan, but you do need to provide proof of income and have a checking account for them to draw the funds automatically from.

The above four methods can help you get a loan when you need it the most, even without good credit.


  1. Doran Waugh says

    For everything there are options available, the choice is ours to make. There are some certain things which you can do while having a bad credit history and among the first is you can take loans. Just make sure that you are taking a loan for an emergency, because most companies will not lend anything, until they are sure that they can take back with interest what they give.

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