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Using $15,000 Personal Loans For Bad Credit Management Purposes

Posted on May 3, 2017 in Uncategorized

Getting our hands on a meaningful loan – one that can make a real difference to our financial situation – is not the simplest thing when we have bad credit scores to our name. The perceived risk involved in lending to us is what makes traditional lenders nervous. Well, the good news is that applications for a $15,000 personal loan for bad credit management purposes are different to others.

Lenders do not like to think the funds a borrower has taken from them will be spent frivolously. So, there is a major difference between seeking a $15,000 loan and a $15,000 loan for the express propose of dealing with debts and bad credit issues. Granting approval to clear debts makes sense to them.

But there is never a guarantee of approval, so even with the best intentions, it is important to meet criteria and satisfy conditions. That is why it is worth enhancing your application in simple ways to increase the chances of securing a personal loan.

Making Sure Of Qualification

As already mentioned, it would be foolish to think that getting a $15,000 personal loan for bad credit improvement is going to be a walk in the park. Applicants still need to qualify for these loans, and there is a need to prove that the repayments would not be too much to handle either.

Of course, there is nothing new to qualifying for a loan, with applications needing to be 18 or more, be either a US citizen or be legally entitled to reside in the US, and they must prove they have a reliable source of income. In fact, most lenders now set a condition that the applicant be employed full-time for at least 6 months before applying.

Seeking loan approval to clear debts is an impressive purpose in the eyes of any lender, but be aware that only if the loan is affordable will approval be granted. For this to be proven, existing debts need to be low, and for the personal loan repayments to keep the overall debt obligations within the 40:60 debt-to-income ratio.

Improving Your Rating

The challenge of securing a $15,000 personal loan (for bad credit borrowers especially) is to show the repayments are affordable. The debt-to-income ratio is significant in that, but a core part of improving that ratio is actually in improving your credit rating.

Accomplishing both comes down to clearing some of your debts. Each debt that is paid off results in the credit score being increased, while the fact that debt is gone means an improvement in the debt-to-income ratio, with extra cash freed up in the process. Taking out a small loan – perhaps a payday loan of $500 – can make a difference.

Of course, while seeking approval to clear debts may be a good reason in the first place, the chance of lowering the size of the monthly repayments, and making the larger personal loan affordable, is too good to ignore.

Offer Some Security

The best possible move to make when trying to secure a $15,000 personal loan for bad credit improvement is to provide some security. This is usually thought to mean collateral, but it may be difficult to find an item worth that sum to offer as collateral.

A better option is to provide a cosigner, someone who is willing to guarantee the monthly repayments and step in to make them in the event the borrower is unable to. Lenders love cosigners as it removes the risk of default, so whether seeking loan approval to clear debts or anything else, the green light is certain.

However, just make sure the person nominated for the role has an excellent credit history and an income that can meet personal loan repayments if it becomes necessary.

Basic Facts About Personal Loans

Posted on April 2, 2017 in Uncategorized

Personal loans are typically general purpose loans that can be borrowed from a bank or financial institution. As the term indicates, the loan amount can be used at the borrower’s discretion for ‘personal’ use such as meeting an unexpected expenditure like hospital expenses, home improvement or repairs, consolidating debt etc. or even for expenses such as educational or going on a holiday. However besides the fact that these are quite difficult to obtain without meeting pre-requisite qualifications, there are some other important factors to know about personal loans.

1. They are unsecured – which means that the borrower is not required to put up an asset as collateral upfront to receive the loan. This is one of many reasons why a personal loan is difficult to obtain because the lender cannot automatically lay claim to property or any other asset in case of default by the borrower. However, a lender can take other action like filing a lawsuit or hiring a collection agency which in many cases uses intimidating tactics like constant harassment although these are strictly illegal.

2. Loan amounts are fixed – personal loans are fixed amounts based on the lender’s income, borrowing history and credit rating. Some banks however have pre-fixed amounts as personal loans.

3. Interest rates are fixed – the interest rates do not change for the duration of the loan. However, like the pre-fixed loan amounts, interest rates are based largely on credit rating. So, the better the rating the lower the interest rate. Some loans have variable interest rates, which can be a drawback factor as payments can likely fluctuate with changes in interest rates making it difficult to manage payouts.

4. Repayment periods are fixed – personal loan repayments are scheduled over fixed periods ranging from as little as 6 to 12 months for smaller amounts and as long as 5 to 10 years for larger amounts. While this may mean smaller monthly payouts, longer repayment periods automatically mean that interest payouts are more when compared to shorter loan repayment periods. In some cases, foreclosure of loans comes with a pre-payment penalty fee.

5. Affects credit scores – lenders report loan account details to credit bureaus that monitor credit ratings. In case of default on monthly payments, credit ratings can be affected reducing the chances of obtaining future loans or applying for credit cards etc.

6. Beware of lenders who approve loans even with a bad credit history – many such instances have proven to be scams where people with a bad credit history are persuaded to pay upfront commissions through wire transfer or cash deposit to secure the loan and who are left with nothing in return.

Large Personal Loans With Bad Credit: A Real Option Despite The Low Rating

Posted on March 3, 2017 in Uncategorized

Having a low credit rating is widely considered to be highly damaging when it comes to applying for loans. But in fact that kind of credit status only has a limited influence over the whole deal. With the right application, it is possible to secure even a large personal loan with bad credit.

It might seem that granting loan approval despite poor credit scores is taking on a major risk, especially on the part of the lender. In fact it is, but there is method in such madness. Remember, lenders have carefully weighed up the respective chances of loss and profit from these deals before ever making a decision.

There is an array of loan sources to choose from, with online lenders offering such opportunities to bad credit borrowers where traditional lenders are usually not willing to. So, even when the applicant is seeking a large personal loan, there are terms available that make even a loan of $30,000 affordable.

Basic Terms To Consider

As with most lenders, online lenders offer a variety of loan packages to ensure a viable financial option to the widest range of applicants. However, they break down to two basic types – secured and unsecured. The one chosen when applying for a large personal loan with bad credit has a big impact on terms.

The most popular option is the unsecured version. This is mainly due to the fact that nothing is offered as security, and therefore, should the loan be defaulted upon, no personal possession can be lost to the lender in compensation.

However, when seeking loan approval despite poor credit scores the best option is the secured loan. By providing something of value as collateral, the borrower accepts the risk of loss which makes the lender more open to granting approval. When it comes to large personal loans, collateral is often expected.

Avoiding The Collateral Issue

Of course, if a loan of $30,000 is needed, it can be difficult to find something worth $30,000 to offer as collateral. But the problem can be avoided by providing a cosigner on the loan – someone willing to accept responsibility for repayments should anything go wrong.

The single largest problem when applying for a large personal loan with bad credit is convincing the lender that they will get their money back, and a cosigner is the ideal security in that sense. While collateral can provide compensation, lenders prefer to simply receive the due repayments each month.

A cosigner guarantees to make repayments if the borrower has trouble doing so, thus making approval despite poor credit scores a viable option. Still, the lender will insist that the cosigner has an excellent credit history and enough excess income to meet the repayments on the large personal loan, if that becomes necessary.

Improving Your Approval Chances

There are hurdles to clear when seeking a large personal loan with bad credit, with the low credit score making many traditional lenders nervous. But there are ways to improve your chances of overcoming such problems.

For a start, it may be an idea to improve your credit score. This can be done by taking out a series of small personal loans, repaying each one quickly. With each loan repaid on time, the credit score is adjusted upwards. Before long, the chances of getting approval despite poor credit scores are much greater.

An alternative option is to take out a consolidation loan and clear debts in full in one go. There is also an advantage in that there is less pressure to clear a longer-term loan, and sufficient income should be freed up to make repaying a large personal loan easier.

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