One-third of Americans have bad credit, and many more of them have no credit at all. So what happens for these folks when an emergency arises and they need emergency money or a loan quickly?
In this blog post, we’ll be discussing some of the options for people to obtain loans with no credit and loans for people with bad credit.
While it may be harder than it is for others to obtain loans with bad or no credit, it definitely isn’t impossible. Read on for some of the ways to finance your emergency.
If you don’t know where you stand with your credit, try Credit Sesame for a free credit report or free credit score.
Getting a Payday Loan
A payday loan is almost exactly how it sounds: an advance of your next paycheck. However, you will need to have a job where you get regular checks in order to qualify. You will also need to understand that not only does this type of loan have very high interest, but it also means that you’ll earn less during your next pay period. You must be prepared for both of these conditions before you use it as an emergency source of cash.
A Title Loan
If you’re in a serious pinch, a title loan can help you pay off whatever emergency fees you need to pay. With a title loan, you’ll need to own a car before you can take one out. You will then give the lender access to your title, meaning that your car is now collateral if you do not pay it back on time.
For the uninitiated, using your car as collateral means that the title loan company can legally possess your car if you do not pay the loan back in full. As such, it is a rather risky road to take, but many people do if they need cash quickly.
A High-Interest Credit Card
A high-interest credit card is not the same as a loan, but it works in a way as a type of loan. A high-interest credit card can help you begin to build credit so that at a later date, you can take out a loan without having to jump through so many hoops.
A high-interest credit card will give you a certain amount of money you’re able to spend, called a limit. Once you reach that limit, you’ll be unable to use your card, unless you and the credit card company mutually agree on raising the credit limit.
Obtaining Loans with No Credit or Bad Credit
Obtaining loans with no credit or bad credit may seem difficult, but it is definitely not impossible. In fact, if you have poor credit or no credit, taking out loans will help you build a credit portfolio. If you ensure that you pay all fees on time and pay back the loans in full, you’ll start to build credit and you won’t need to resort to loans with such high-interest rates.
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