Direct Lenders for Bad Credit Loans

Getting a loan can prove to be very difficult for people with bad credit ratings. Traditional lenders such as mortgage brokers, credit unions, local banks, etc. will not lend to people with bad credit ratings.  Even when a loan is sanctioned for such people, the interest rates charged could be much higher than in normal cases. However, there are other avenues available for people with bad credit ratings. There are plenty of direct lenders who lend loans for people with bad credit ratings. These direct lenders have a multitude of loan products from which you can choose the loan that best suits your requirements. These direct lenders for bad credit loans will provide you your loan promptly without the hassle of the approval procedure.

Prior to searching for a bad credit loan lender, it is imperative that you determine exactly how much you really can afford to pay back monthly. In this way, you can look for the right direct lender that you can afford. After short-listing the preferred lenders, you can compare their offers to find a lender with lower rates and terms. Comparison websites can help you to compare rates of various lenders. Lastly, you should do a background check on any lender you consider through the Better Business Bureau to make sure they have a good reputation and are well established.

Conditions for getting a bad credit loan from a direct lender

There are no significant conditions to be met to get a loan from a direct lender for bad credit loans. The following minimum conditions should generally be met:

•    Be a permanent citizen of the US and
•    Be of 18 years or higher
•    Have a steady income of more than $1000 each month
•    Have a legitimate and active checking account.

Two types of bad credit loans offered by a direct lender

Direct lenders come in various sizes, from very big lenders to small ones. The loan amount could be limited depending on the size of the lender.

There are two types of bad credit loans, the secured loan and the unsecured loan.

  The secured loan

These types of loan are usually preferred by persons requiring a huge amount of cash. In this type of loan, the interest rates charged are low as these loans require you to pledge collateral to the lenders. It can be any property you own, such as a house or a car. Secured bad credit personal loan allows you to borrow as much as 125% of the property value and longer repayment terms. Because of the collateral, the lenders will be willing to lend larger amounts. The advantage in opting for this type of loan is that people with bad credit can get some flexibility on the terms and significantly reduce their overall repayments.  The downside of this option is that if you cannot repay the loan; the lender can take your property.

•  Unsecured loans

People with bad credit do not have to give collateral to get these types of loans. The only assurance you give the lender is your word and your signature. But because of this, the interest rates are high as the lenders have no cover for non-payment. The loan amounts are limited and are restricted to shorter payment periods. You should always get your unsecured personal loan for bad credit from a reputed direct lender as it will ensure a hassle-free time when making repayments.

There are many direct lenders out there, so check everything out thoroughly and get the loan you want even while having a bad credit rating.

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