If you’re an individual with either poor credit or no credit, traditional lenders may view you as a high credit risk. Generally, it has been found that people that don’t have decent established credit will default on loans eventually. Since banks don’t want to be left without any recourse in case of a defaulted loan, they often deny those that don’t meet their standards.
Getting loans with bad credit is not an easy task, and it requires you to think outside of the box. It’s possible to get a loan, but you will need to work extra hard.
Your first option is to get approved online for a payday loan. This loan is great to help you meet short-term goals, but the downside is that the loaned amount will need to be paid back from your next paycheck. The interest rates may also seem high to some borrowers, and that will need to be taken into account when you’re paying back what you borrowed.
Another reasonable option is to visit a local credit union in order to get a loan. These institutions are similar to banks, but they’re owned by a non-profit group and run by their members that have a common goal. Credit unions are often easier to deal with, more agreeable in terms of customer support, and they offer lower interest rates than banks.
Lastly, if you’re seemingly out of options, peer to peer lending may be worth looking at. It is a fairly new concept that was conceived in 2005, and it allows you to borrow from individuals as opposed to lending institutions. The downside is that these companies look at your credit score and post it publically, and meanwhile, it may not be the only determining factor for approval, it still counts.