Today I’m going to talk to you about getting a loan if you are in the unfortunate situation of having a bad credit rating. If this is you – my first tip? Don’t get a payday loan! Even if you do have bad credit, there are so many different ways to get a loan, cheaper than payday loans.

If your credit rating is bad, the unavoidable truth is that you will pay more interest than people with good credit because your credit score makes you look like a high risk for any lender. It’s a commercial reality. However, that does not mean your only option is to be trapped into paying painfully high interest rates on a payday loan!

We’ll show you all of the options available for people with bad credit. So, please watch this video carefully.

But before we move on, I want to explain to you about payday loans and why you should always avoid them.

Firstly, there are many people who still believe that payday loans are the only option if you have bad credit. The good news is, that’s not right!

Payday loans are expensive – painfully so – and often lead people to a debt cycle, destroying their credit history. According to the Consumer Finance Protection Bureau, these loans average at 400% APR.

Let’s think about that for a moment. If you borrow $100 from a payday lender, you’ll have to pay back around $15 every two weeks. Now that is expensive. We’ll post a link to the CFPB’s article in the description below, where you can read for yourself what they really think about payday loans.

Now, sadly, too many people are still ending up with these payday loans. We ran our own analysis and found that around 70% of people who have taken out these loans could get something cheaper or qualify to refinance their existing payday loan with a much better one.

Tip:

Now you probably expect me to start listing off offers to tell you to register here and there … and so on. Well, we at ElitePersonalFinance have always tried to help people make smart financial decisions and save money. We are not here to scam you or offering something that is not right for you. And to be honest, our biggest tip is obvious – if you have a bad credit rating, try to avoid getting a loan in the first place.

Instead, wait – simple as that – work on your credit score using some basic techniques to improve it – and then, and only then, get a loan.

See, even if you do qualify right now for a personal loan, you do that, you’ll pay much higher interest than you need to.

Instead, stop and think for a moment. Do you have options to avoid getting a loan in the first place? For example, can you cut some day-to-day expenses – you know, maybe find a cheaper store to buy food, or do you really need that extra bag of candy – you know the thing. Or work on increasing your income, if that’s possible? Could you ask for a cash advance from your workplace, or even ask someone else to help you. There are so many options. Try everything. The point is, they are all likely to cost you less than taking out a payday loan.

So, if this does work for you, don’t waste this time. Use it and start working on your credit score!

And once that improves, then that’s the time to get a loan.

It sounds obvious, but people with a good credit rating pay very cheap interest rates and have many more options.

The problem comes if you’re in an unfortunate situation where you can’t wait, and you need to get a loan now.

Personal Loans

By definition, personal loans are unsecured loans, paid in installments. Some lenders offer up to $100,000 for people with a good credit rating and, of course, a proven high-income stream. In most cases, the amounts tend to be around $30,000 to $50,000. All personal lenders cap their APR anywhere between 5.99% to 35.99%. This is a standard that all legitimate lenders use.
So, if someone offers you a loan with an APR of over 35,99%, then you need to start asking some questions – is this even a personal loan at all! I think we have a name for it, but we’re not allowed to use that word in polite society!
So, let me answer the most important question.

Can I Get a Personal Loan if I Have Bad Credit?

The answer is yes. You can. But you also need to temper your expectations. Firstly it won’t be for a large amount, and secondly, it’s not going to be the cheapest APR.

Now, people with bad credit can typically get an APR of between, say, 15% – 35.99%. Ok, that’s still not cheap, but you compare that to a payday loan of 400%? Your starting to get the picture, right?

Ok, next question.

Where and How Do I Find a Personal Loan?

Shop around! Now at any given time, no one can tell you exactly where until you try. But do shop around, apply to all personal bad credit lenders and see what they offer you. Make a list, set it out clearly so you know exactly what you’re being offered, so you can compare them all side by side.

And to make your life easier, we’ve created the largest financial marketplace… here.

And don’t worry, we’ll add that link in the description down below. Here you’ll find all those financial products in one place! Loans, credit cards, credit reports, insurance, and so on.

And sorry, yes, that was a quick ad.

But really, guys, we take this very seriously and what drives us at ElitePersonalFinance is a basic ethos to help people stop being ripped off.  We’ve actually created something perfect for people who want to find the best financial products and help them save time. Go take a look – I think you’ll be impressed.

So, take a look and apply through these sites and see what happens. You’ve nothing to lose. All of them are totally free to apply, and here’s a thing… all of these perform what’s called a soft inquiry on your credit score, so it’s a myth that doing this loses you points on your score. So go ahead and do it – and don’t worry about it.

Okay, so to wrap up, I want to give you a quick overview of what’s actually happening in the personal loan market and why this is good news.
The first piece of good news is that you can easily get a personal loan, even if you have bad credit.

Also, if you’ve applied in the past and were denied, don’t give up. It’s a different world now. As the market continues to evolve, more and more lenders are now offering online personal loans to all credit scores borrowers.

What is Happening in The Lending Market?

We’ve seen that as more companies have come into the marketplace over time, the competition’s increased. And with this competition, lenders are now being forced to decrease their minimum credit score to compete and as a way to try and stay in business. For you, this means higher approval rates and better loan terms.

We’ve also found that the Credit scoring models have changed and evolved as well.

Up until now, lenders analyze your credit score. It was a straightforward – and pretty blunt algorithm. Now they’re looking at other factors like your work history, education, annual income, spending activity, and savings balance – all of which now give you loads of opportunity to work on to overcome that bad credit score.

And Finally a Quick Word on Loan Terms

Even if you do have bad credit, many lenders now offer higher loan amounts, lower APRs, flexible refinancing options, and charge no late payment fees. More importantly, loan contracts have become much more transparent – leading to less or oftentimes no hidden fees, which all in all is no bad thing.
So keep your head up. The lending market is improving, and here at ElitePersonalFinance, we’re good at what we do, and we like to point you in the right direction!

In this video, we’ve talked about how to get a personal loan if you have bad credit. Unfortunately, not all people with bad credit will qualify for a personal loan. But there is still good news if this is you. There are many other types of loans available for those with even really bad credit. Secured loans, cosigner loans, credit unions, banks, credit cards, loan apps, and many other types of alternatives to payday loans. We will talk about all of them in our next video. And in that video, we’ll give you some really interesting inside information that, firstly, I’ll bet you won’t know about and, secondly, could really help you. So make sure you don’t miss our next video.

Now, it’s time for me to ask you something that’ll really help us continue to bring this valuable information to you. All you have to do is please like this video, subscribe and share on your social media channels – we’d really appreciate it.

So to finish off, let me ask you a few questions. We’re really interested in your experiences out there – pop a comment below and quickly tell us about your experiences with bad credit loans.

• Which personal loan companies have approved you and which denied you?
• Is there anything you want to share with us about your lender?
• Also, what’s the highest APR you’ve been offered or seen advertised, and where do you think we can find the cheapest APR?

We’d really like to read real reviews from people who actually have loans, like you!

And finally, we’d really love to know if you like our channel. Don’t worry – tell us the truth. We really do appreciate all feedback.

So, please leave a comment below.

This is Angus Scott for ElitePersonalFinance, and I’ll see you next time.

Thanks for watching!