How to Get a Loan If You Have Bad Credit

How to Get a Loan If You Have Bad Credit

There are several causes why you might have bad credit. Perhaps you’ve made some late payments in the past, or you have a few outstanding debts you’re struggling to repay. Whatever the reason, having bad credit can make it difficult to get a loan. However, there are still some options available to you. Here are eight ways to get a loan if you have a bad rating.

1. Find a Cosigner

Another option is to find a cosigner—someone who agrees to be responsible for repaying the loan if you can’t—with better credit than yours. This option usually requires collateral, such as property or a car, as security against the loan if you default. The benefit of using security is that it may help you get a lower charge rate on an advance.

2. Use a Payday Alternative Loan

Payday loans are short-term credits with high-interest rates and fees. However, there are some alternatives available that may be more affordable. Some federal credit unions offer payday alternative loans (PALs) and have terms of one to six months. 

The maximum amount you can borrow is typically $500, but this may vary depending on the credit union. PALs typically have lower interest rates and fees than payday loans and may be an option if you need cash quickly and have bad credit.

3. Get an Unsecured Personal Loan

An unsecured personal loan does not need any collateral and is based solely on your creditworthiness. Because any asset does not back them, these loans tend to come with higher interest rates than secured loans—which means they may not be ideal if you have a bad rating. However, they may still be an option if other options are unavailable.

4. Consider a Title Loan

A title loan allows you to use your car as collateral for a loan—meaning that if you can’t repay the debt, the lender can seize your car. These loans tend to come with high-interest rates and fees, so they should only be considered a last resort if other options are not available or viable for your needs. 

In addition, because your car is used as collateral, failing to repay the debt could result in losing your vehicle—which could leave you without transportation. For these reasons, title loans should only be considered an option of last resort.

5. Look into Peer-To-Peer Lending

Peer-to-peer lending platforms connect borrowers with individuals or institutions willing to lend money. These platforms typically consider factors such as your employment history and income when making lending decisions—meaning that even if you have a bad rating, you may still qualify for a peer-to-peer loan. While interest rates on these loans can vary depending on the platform and lender, they may still be lower than what some traditional lenders offer.

6. Ask Family and Friends

If all else fails, one final option is to ask family and friends for help. While this option may only be ideal for some, it’s worth considering if other options are available. Families and friends may be more likely to lend money at lower interest rates—or even give money outright—than traditional lenders; make sure both parties understand the terms of repayment before entering into any agreement.

7. Online Lenders

If you have very bad credit, getting ratified for a loan can be difficult. However, some lenders specialize in very bad credit loans and may be ready to give you an advance even if your rating is not very good. One way to find these lenders is to search online for the terms “very bad credit loans guaranteed approval.” This will help you find lenders willing to give you advance even if your rating could be better.

8. Credit Unions

Another option is to try a credit union. Credit unions are nonprofit organizations typically much more prepared to work with borrowers with less-than-perfect credit. In addition, they often offer lesser interest rates and fees than old-style banks. As a result, a credit union can be a great option if you’re looking for a loan with bad credit.


Many options are available for people who need loans but have bad credit, from using a cosigner or securing collateral to finding alternative lenders. Do your research carefully before selecting an option, and ensure you understand all the terms and conditions involved. Doing so can ensure that You’ll get the best possible deal on your loan.


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