How Can I Borrow Money When I Have Bad Credit?

Having bad credit can be annoying when you need to borrow money. Whether it’s because you need a new car, need to replace something in your home, or just have an unexpected bill, it can be frustrating to know that your bad credit is holding you back.

However, there are still ways to borrow money when your score is bad, so here’s how to find them.

Borrowing from people you know

Forbes says people who can’t borrow through the usual routes will often take out loans from friends or family. While this may seem like an ideal solution, it can put a strain on your relationships, and mean loved ones see you as being irresponsible, especially if you make a habit of it. Worst of all, it can put your friends and family in a difficult financial situation themselves, as they have to wait for you to pay it back. If it’s a one off, you are honest about your situation, and pay back on time, then this may be an option for you.

Finding bad credit lenders

There are an increasing number of lenders who now offer credit to those who may have struggled to get it in the past. For example, Cash Lady who offers payday loans will often consider those with less than perfect credit. Opting to apply for lenders who specialize in bad credit will mean less disappointment, and will look better on your credit report, as you won’t have lots of searches and rejections.

Look for small, short-term loans

Many people with bad credit don’t want to borrow huge amounts of money, or be paying it back for a long term. They tend to want small amounts that they can pay back either in full on their next payday, or in a few installments. Look for small, short-term loans that only cover your specific emergency, rather than taking out a big loan from the bank and wasting your money.

Short term lenders, especially those who work with people with bad credit, will often charge higher interest rates for borrowing. If you pay them back as soon as possible, then this kind of borrowing can still be affordable, but if you constantly defer your loan or extend your credit, then you could end up with a long repayment period and paying back a lot more than you originally borrowed.

Be sure to know all the facts about your credit score.

Avoid borrowing when you can

If you’re in a cycle of borrowing and paying back money, then you should consider what you could do to make yourself more financially stable. There’s lots of information online about how to deal with debt and manage your money, and if you avoid borrowing anymore and start paying things back, then you should see your credit score soon start to rise.

When there’s an emergency situation such as an unexpected bill, it can be difficult to avoid borrowing money. If you have bad credit, then it can be harder to find lenders, but a few specialize in these sorts of circumstances, so you don’t have to waste hours looking for a loan.