Low Credit Score Loans
While largely dependent on the use of the word “low” here, there are still a lot of ways to work things for low credit score loans.
Scores range from 350 to 850, with most people falling between 500 and 750. Every financial institution has their own standards for what they’ll accept and what all these numbers mean to them, but we can make some general statements about what all this means.
If your score falls below 500, I’m sorry to say there is really very few options available to you. I strongly suggest going over your credit report and trying to improve things before seeking any kind of loan.
People in the range of 500 to 600 are generally what I would call low and the farther down you are the harder time you will have. The first thing I’m going to say is that you should try and fix some things on your report to make your situation more favorable. Now, I know that many people will advise you to look for lenders specifically geared toward low credit customers, however, I would first try at any places you are already associated with. Credit unions are known for having the best available interest rates. Even with your low credit score most lenders will still look at other factors like your report, employment, and your debt to income ratio. For this reason it is a great idea to pay down balances on your cards before seeking a loan. In fact, this will help improve your credit score as well.
If financial institutions you are familiar with do not work for you, the next step is to seek out low credit lenders. If you’re looking for a mortgage, a broker who specializes in low credit score loans will be able to apply to multiple places quickly until they find you the best possible deal.
It is important to take note that no matter what path you take your interest rates will be very high, depending on what amount you are looking at this can push your monthly payments up hundreds of dollars which will ultimately effect the amount you will be able to borrow. If you are looking to get a long term loan do consider trying to improve your credit first. If this isn’t an option for you at least look for a deal without prepayment penalties so you can more easily consider refinancing as an option in the future if your score improves.
Low credit score loans are available with a variety of options out there.