Credit history is one of those things that can be quite a pain if the credit score is among the benchmarks that banks consider to be safe. But financial mistakes are sort of unavoidable at times, there might be more people in your network who have taken bad financial decisions than you could take a guess. A series of such bad decisions can lead to a poor credit score.
With a bad credit score, access to overdrafts, credit cards, and loans become much more difficult. But loans for bad credit no guarantor are still available at some firms, even in such situations. What’s more – at times they don’t even need a credit check.
It makes sense that you could apply for a loan when you have a good credit score. But why would you want to apply for a loan when your credit score is already in a sorry state? There are quite a few good reasons for that.
Debt consolidation plays a major role in requiring loans even in the face of a bad credit score. Credit card dues can rake up quite high charges if the timely payment of monthly dues isn’t done. With unexpected expenses like urgent medical expenses, emergency repairs, and renovations, debts can tend to pile up. If you have been unemployed for a long time, it can be an additional headache trying to make ends meet and have appropriate funds to maintain a decent lifestyle.
In such cases, a proper financial alternative can help resolve the situation. But a good credit score is the key to getting access to a loan that can help here. In case of bad credit, most banks will still require you to have a guarantor. If you are that deep in debt, there will rarely be anyone who is going to help you out.
Contrary to what you may think, there are still firms out there that can help you get a loan even if you have a bad credit score and cannot source a guarantor. You can opt for guaranteed loans if you have bad credit. The benefits to availing such loans are as follows –
- You don’t have to source a guarantor
- Your credit score can get a good boost
- Guaranteed loans normally feature easy approvals
- Your credit history won’t be scrutinized for this
- The repayment is much easier and relaxed
- There are options where you don’t need to provide collateral
How can something be so helpful and not have a downside to it? Well, guaranteed loans are typically of smaller amounts, so you don’t rake up a humongous amount of interest. The advantage here is that you can repay the smaller amounts as scheduled and that in turn gradually improves your credit score.
Personal loans, short-term loans, and payday loans are the variants that are offered under guaranteed loans. A personal loan is the kind of loan that can provide you with the largest amount of money. This can be helpful if you are looking to consolidate large debts or pay off large credit card balances. A short-term loan would be ideal in case you have emergency expenses that are currently out of budget. A payday loan can suffice for smaller emergencies. The repayment term for such loans can be as high as 36 months or as low as 2 months.
Such loans help you get back on your feet again and even help in repairing your credit history and credit score.