You aren’t going to be able to get a high risk personal loan from your bank, but there are specialist lenders who will be prepared to assist you. Fast cash loans for bad credit are different from bank and peer-to-peer loans because there is no credit scoring at any stage of the application process. Lenders are more interested in proof of identity and your ability to repay the debt, not past credit problems.
Personal loans for bad credit have their critics, but they are helping a section of society that has been shunned by the banking sector. Most of the customers have a history of poor credit and the cost of borrowing does reflect this. Interest rates are flat, not tiered. Only deal with lenders who clearly outline their charges, as it’s important to know where you stand and how much you’ll need to repay.
Payday Faxless Fast Cash Loans from a Bad Credit Loan Lender
A high risk personal loan from a payday lender could provide you with a way to borrow money with bad credit. A payday cash advance loan isn’t designed to consolidate debt, its purpose is purely to help you to make it through until the next payday. Typically lasting for 2 to 4 weeks, they are a bad credit short term cash loan for up to $1,000 for people who are in full-time employment.
The criteria for this no credit check personal loan are completely different to what the banks use. Provided that you’re working, over 18 years old, a U.S. citizen and have your own checking account, approval is guaranteed. All that remains is to provide identification and a postdated check set to clear when you’re paid. The lender will perform a bank transfer which will arrive the next day.
If you can’t afford to repay the debt, you can roll it over until the next month. However, given that it costs $20 to $25 to borrow $100 for a month, please bear in mind that interest will continue to accrue. Research by responsiblelending.org indicates that 76% of payday faxless fast cash loans are repeat business. Some states have introduced their own restrictions.
Bad Credit Auto Title Secured Loans with No Credit Checks
An automobile title loan involves using your vehicle as collateral to borrow money. Your car will be assessed based on the blue book value and you’ll be offered a cash advance of between 30% and 50% of the cars worth. This is to cover depreciation and any interest that accrues in the event of default. The customer will be expected to provide identification, a copy of the car title and a duplicate set of car keys.
The cost of borrowing is roughly the same as payday faxless fast cash loans, but the maximum loan value can be far higher due to the provision of equity. Once again, some states have placed restrictions on the cost of borrowing. For example, the maximum rate of interest in New Hampshire and Iowa is 25% and 36%, respectively. Other states have banned this type of high risk personal loan entirely.
Failure to repay a bad credit auto title secured loan will lead to the repossession and sale of your vehicle for fair market value. Most no credit check personal loans are for 30 days, although most lenders will allow you to renew the advance to give you additional time to make repayment. A Missouri Auditor found that there were 3.5 times as many renewals as there were new cash advances.
Advantages and Disadvantages of High Risk Personal Loans
Personal loans for bad credit can help customers to meet a short-term financial need, such as paying the rent. The high default rate amongst borrowers means that interest rates are often considered usury. Coupled with the high renewal rate and it could be argued that it’s very easy for fixed and low income families to get caught in a cycle of dependency. Before signing-up to any of the best online personal loans for bad credit, it’s important to consider how you’ll repay the debt the month after.