Understanding the Approval Process for Bad Credit Signature Loans
In such a strange financial situation as we face in the US right now, lenders and borrowers are interacting with each other much differently. It used to be unbelievably easy to stroll into any bank for short term loan store and end up with exactly the amount of borrowed money you expected to get. A great personality and a winning smile aren't going to get you approved as it seems they used to.
Take the approval process for example; most prospective lenders are going to start off by asking you to put your entire credit past on display, including your FICO score and and printouts of your past track record as a borrower. You might have to dig deep in your bag of tricks to prove you're an okay prospect as far as lending small amounts of money for short periods of time. It may not be easy, but you can still get approved if you go about it the right way.
At the same time, if you have horrible credit, or no credit history at all, there are certain kinds of loans you'll want to investigate. One of them is a bad credit signature loan. Although the terms and interest rates are not going to be ideal with these loans, they may be the path you have to take to accomplish your goal.
Look at this situation through the eyes of a typical lender. They need to know, or at least have some reassurance that they're going to see their money again. How would you feel if you lent a person hundreds of dollars and never heard from them again?
That's obviously no way to run a successful business, so they will need some kind of insurance against you bailing out on the transaction. One of the best ways to get them to lend you the money is to prove you actually have a noticeable income. If they can see you're a steady earner, it will go a long way to comfort their nerves about lending you the cash.
How much do you need to be earning? Well, if they're going to lend you, say, $500, I'm sure they wouldn't be comfortable with you earning less than $1000 to $1200 per month. It should be easy to prove that with a few weeks' worth of pay stubs. If you can't produce enough canceled checks or pay stubs, then you may want to ask your employer for a letter proving your status as an earner.
Once you've proven your income, the lender will feel much more confident giving you the money. If they still feel uneasy about letting you borrow cash, you may need to provide some kind of collateral. Some of your options for collateral would be expensive jewelry, a car title, or even your big screen television.
If you can give them some piece of valuable collateral to cover their loan, there shouldn't be anymore obstacles between you and your signature loan. It doesn't seem reasonable that they'd seek any other evidence of your credit worthiness beyond that. Get a couple of good loans under your belt and the approval process will get easier over time.
Take the approval process for example; most prospective lenders are going to start off by asking you to put your entire credit past on display, including your FICO score and and printouts of your past track record as a borrower. You might have to dig deep in your bag of tricks to prove you're an okay prospect as far as lending small amounts of money for short periods of time. It may not be easy, but you can still get approved if you go about it the right way.
At the same time, if you have horrible credit, or no credit history at all, there are certain kinds of loans you'll want to investigate. One of them is a bad credit signature loan. Although the terms and interest rates are not going to be ideal with these loans, they may be the path you have to take to accomplish your goal.
Look at this situation through the eyes of a typical lender. They need to know, or at least have some reassurance that they're going to see their money again. How would you feel if you lent a person hundreds of dollars and never heard from them again?
That's obviously no way to run a successful business, so they will need some kind of insurance against you bailing out on the transaction. One of the best ways to get them to lend you the money is to prove you actually have a noticeable income. If they can see you're a steady earner, it will go a long way to comfort their nerves about lending you the cash.
How much do you need to be earning? Well, if they're going to lend you, say, $500, I'm sure they wouldn't be comfortable with you earning less than $1000 to $1200 per month. It should be easy to prove that with a few weeks' worth of pay stubs. If you can't produce enough canceled checks or pay stubs, then you may want to ask your employer for a letter proving your status as an earner.
Once you've proven your income, the lender will feel much more confident giving you the money. If they still feel uneasy about letting you borrow cash, you may need to provide some kind of collateral. Some of your options for collateral would be expensive jewelry, a car title, or even your big screen television.
If you can give them some piece of valuable collateral to cover their loan, there shouldn't be anymore obstacles between you and your signature loan. It doesn't seem reasonable that they'd seek any other evidence of your credit worthiness beyond that. Get a couple of good loans under your belt and the approval process will get easier over time.
About the Author:
It's important to research everything you can about signature loans bad credit if you don't want to get roped into a bad loan and Travis is the person to teach you. You may also want to look into his website about student signature loans.
posted by Credit Counseling at
5:45 AM
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