Is It Wise To Get Fat Loans With Bad Credit?
- By Balthazar Svengali
- Published January 29th, 2012
- Finances
- Unrated
100% Guaranteed Approval! Your $$$ in hours. Even with Bad Credit!
Is it wise to get large loans with poor credit? The answer is: maybe. It depends on whether you're 99.99% confident you can pay them back speedily before too much interest accumulates.
The fact that you have bad credit indicates that for whatever reason you're more likely to be bad with money. You got into trouble before, maybe for a small HP agreement and now you either can't get a loan or the rates are ridiculous.
If you just made a stupid mistake, that's good. Say you bought a TV on hire-purchase and thought you would sit out a few payments without comeback. Then you applied for a personal loan and got a surprise. Your credit rating is now bad and this means you get offered silly deals or none at all.
Lending companies are pleased to lend to folks who are a safe bet. These are people who have received loans before and repaid them. Or they've purchased something on hire-purchase or paid their credit-card bills on time. It could even be something as basic as returning your DVDs to the rental shop. All lenders have got to go on is what's on record. They can't analyse what you're like as a human being and it doesn't matter anyway. Things like bankruptcies and CCJs are big red flags, obviously.
Some companies target people with poor credit. They're like bookies hooking gambling addicts. They know they've got a captive market. Loan sharks still exist. They offer you payday loans at 1234% P.A. interest. People who can't do basic maths think this might be a good deal. Why? Because the deal is
couched in language like "Get a 500 quid loan and only repay 565 by the end of the month". It looks bearable. Especially if you're mad for money and no other lending company will touch you.
So what can you do to fix this situation?
First, try your own simple credit repair.
Start by paying off high interest loans, like credit card debt. Then cancel all your credit cards _except the oldest one_, for the credit history attached to it. Credit referencing agencies look at all the potential credit lines you have left open when deciding how much of a risk you are.
Buy a few small things on the old card, then pay off the debt religiously. Pay all your bills before the due date. You don't want companies flagging you up for missed payments.
Next, do not make too many applications to different lenders within a one month period. This is for personal loans. Mortgages or car loans are OK. It looks like you are desperate and that's a bad sign. All these guys know about you is what they've got on file. You should send up green flags, not red ones.
Go to a few loan comparison sites. Don't make any applications. Just see who's offering what. You'll see the same company names popping up over and over again. These are bad credit loan specialists. They offer deals like: borrow 500 and pay back 550 within the month. Sounds good? It can be, if you can pay it back within one month. What it means, however, in that example, is that you're being charged 120% interest P.A.
Small loans are manageable if you can pay them off quickly within the month. They can quickly become a nightmare if you can't.
The fact that you have bad credit indicates that for whatever reason you're more likely to be bad with money. You got into trouble before, maybe for a small HP agreement and now you either can't get a loan or the rates are ridiculous.
If you just made a stupid mistake, that's good. Say you bought a TV on hire-purchase and thought you would sit out a few payments without comeback. Then you applied for a personal loan and got a surprise. Your credit rating is now bad and this means you get offered silly deals or none at all.
Lending companies are pleased to lend to folks who are a safe bet. These are people who have received loans before and repaid them. Or they've purchased something on hire-purchase or paid their credit-card bills on time. It could even be something as basic as returning your DVDs to the rental shop. All lenders have got to go on is what's on record. They can't analyse what you're like as a human being and it doesn't matter anyway. Things like bankruptcies and CCJs are big red flags, obviously.
Some companies target people with poor credit. They're like bookies hooking gambling addicts. They know they've got a captive market. Loan sharks still exist. They offer you payday loans at 1234% P.A. interest. People who can't do basic maths think this might be a good deal. Why? Because the deal is
So what can you do to fix this situation?
First, try your own simple credit repair.
Start by paying off high interest loans, like credit card debt. Then cancel all your credit cards _except the oldest one_, for the credit history attached to it. Credit referencing agencies look at all the potential credit lines you have left open when deciding how much of a risk you are.
Buy a few small things on the old card, then pay off the debt religiously. Pay all your bills before the due date. You don't want companies flagging you up for missed payments.
Next, do not make too many applications to different lenders within a one month period. This is for personal loans. Mortgages or car loans are OK. It looks like you are desperate and that's a bad sign. All these guys know about you is what they've got on file. You should send up green flags, not red ones.
Go to a few loan comparison sites. Don't make any applications. Just see who's offering what. You'll see the same company names popping up over and over again. These are bad credit loan specialists. They offer deals like: borrow 500 and pay back 550 within the month. Sounds good? It can be, if you can pay it back within one month. What it means, however, in that example, is that you're being charged 120% interest P.A.
Small loans are manageable if you can pay them off quickly within the month. They can quickly become a nightmare if you can't.
Written by Balthazar Svengali
Want to read more? Go to http://www.getloansforbadcredit.co.uk and then give Tommy a call. Tommy used to be a credit broker and is also a part-time webmaster for 24 hour emergency plumber and self storage websites in London, UK. He has 12 year's experience in commissioning software, websites and services and understands how to get your job done quickly and to the highest standard.
