Articles » Bad Credit
Bad credit is seen more often than good credit since the last year or so. Bad credit is the result of numerous issues, but obtaining a loan is still a possibility. Depending on your current situation, you may still be able to receive lending from a bank. Bad credit stems from the most obvious issues, such as not paying your bills on time. For every thirty days late, a creditor will post this negative occurrence on your credit report for all to see.
If you go over your credit card limit, even if you made the point to pay it off within the next pay cycle, your high credit balance will always show to future creditors. It is best to stay away from your limits for this reason. Unfortunately, with job loss and scarcity, there are more instances of foreclosure and repossession than ever before.
Obtaining a loan, whether it be an unsecured personal, business or auto is still a possibility. Banks looks at other qualifying matters other than just your credit score. Stability is one of these matters. When applying for a loan, the bank wants to know how long you've been at your address and how much you pay for rent or for your mortgage. The longer you've been at the same address, the better. Your lender will also want to know how long you've been at your job, and of course the same rule applies here - the longer, the better.
Income is important when requesting a loan. The more you make, the more likely you are to get a loan. However, debt to income ratio is very important. Banks will look at the money you have coming in vs. the money you have going out to decide whether or not you can afford to pay them back. Someone who makes less money than you but has no liability may have an easier time getting a loan.
Loans for people with bad credit are possible. Be prepared to prove your income and have your credit report personally reviewed and corrected if any errors are found. You may end up paying a higher rate for unsecured loans, but this is a minor penalty for getting what you need. If you have any assets, be ready to review them with the bank for loan determination, as well. This may in fact allow for a lower interest rate based on collateral.
