The 9 Best Loans for Bad Credit in 2019
Over 8 million people in the United States have bad credit.
While this isn’t great news for the economy, if you’re one of those millions of people, it’s nice to know you’re not alone.
However, when you’re strapped for cash or need help making a large, life-changing purchase, it does make it more difficult to get a loan.
If you can get a loan, you’re slapped with ultra-high interest rates.
Don’t fret! There are still options. In today’s market, everybody’s got options. That’s why we’ve compiled a list of the best loans for bad credit.
Offering Collateral for a Secured Loan
Secured loans are a great alternative to lowering the loan amount you request. The only catch is that you’ll have to put something up for collateral. This can be a car, truck or even a motorcycle.
If you’ve already got motorcycle loans or even a lien on your car, you might not qualify for this one.
If you can, however, it’s a great option. This is one of the best loans for those with bad credit because they tend to have lower interest rates. And, you’ll be able to request more money.
Forego the Banks for a Credit Union Loan
Credit union loans are generally easier to get than loans from a bank. This is because credit union standards are a little more flex.
Nearly anybody is eligible to join a credit union as long as they live in a certain area.
And, because credit unions are non-for-profits, they’re able to offer loans at a cheaper rate than traditional financial institutions.
They tend to even give out unsecured loans for bad credit owners. This means you won’t have to hand over anything in collateral!
Peer-to-Peer Lending Offers Some of the Best Loans for Bad Credit
P2P (peer-to-peer) lending has become popular in recent years, as it means whoever is providing the loan assumes less risk.
These platforms match borrowers up with one or more lenders who lend the money on their own terms.
This is one of the best loan options for those with bad credit simply because it takes banks out of the equation. You’re still responsible for paying the money back, but you’re less likely to get turned down.
Installment Loans That Require Monthly Payments
If you need cash and you need it now, you can look into an installment loan.
These types of loans are repaid in regular installments (hence the name), that are usually monthly.
They’re easier to get than other types of loan because they’re considered short-term. The repayment period is usually set to about six months.
People with all types of credit scores can usually qualify for installment loans.
Co-Signed Loans for Those with Great Friends
If you’ve fallen on hard times but a friend or family member still has great credit, you might consider a co-signed loan.
The person who will co-sign the loan is essentially saying that they’ll pay back the loan if you can’t. This is a lot of responsibility, so it’s important to be smart about who you ask.
However, if you can find someone you trust who will co-sign, then these types of loans are great. They are like regular loans with normal interest rates and terms.
Taking Out a Loan on Your Home Equity
If you own a home and have equity tied up in it, you could qualify for a Home Equity Line of Credit.
What you’ll be doing is putting your property investment up as collateral. While this might sound risky, they’re one of the best loan options if you have poor credit.
This is because you’re able to take out a tax-deductible line of credit with fair interest rates. And, the bank won’t monitor how you spend the money.
Credit Cards Offer a Different Type of Loan
If you have bad credit, it might be hard to get a new credit card. Companies like Fingerhut, Total Visa, and First Access Solid Black tend to offer cards with lines of credit to those with low credit scores.
Most people don’t seem to consider this when thinking about taking out a loan. But, credit cards are a great way to save on interest fees.
Most cards give you 21 days from the end of the payment period to pay your bill. If you pay the amount due in full, they won’t charge you interest for the things you purchased.
A 0% interest rate is hard to come by. This makes credit cards a great choice for those in need of smaller amounts of quick cash.
Let Bad Credit Loans Do the Work for You
If none of the other options have worked for you, then you’ll want to head over to Bad Credit Loans.
They’re known for pairing those who have bad credit with willing lenders. This is similar to a P2P lending platform, but specifically for those who can’t get a loan anywhere else.
To qualify, you’ll need to have a valid phone number and email address. You’ll also need to have a regular source of income and have an open checking account.
Personal Loans from Friends or Family
If you can show that you’re working on correcting your money management habits, then asking for a personal loan from friends or family is a good idea.
This reduces the risks involved in working with a bank. And, you’ll be able to decide on how to repay it in a way that makes more sense for you.
Drafting up a loan agreement is still a good idea, and it’s important to ensure you can repay the loan. It’s never a good idea to let finances create a strain between you and loved ones.
Working Around Bad Credit
Bad credit means different things to different lenders. This is why it’s so important to shop around, compare and speak with different providers.
The best loans for bad credit, however, will be ones that provide you with fair interest rates and good terms.
For more information about how to find the best loan rates, check out our advanced search function to get the best results.