A bad credit score can potentially ruin your life, just like college grades. Or so they say. Nowadays, life is all about consumerism and while the current financial system aspires to enhance the quality of life, we rarely see it happening. On the contrary, the current financial system only helps the rich and completely ignores the poor. There were times in our lives when we failed to make a payment before deadline due to emergencies or more pressing matters that required our attention. Even though it doesn’t necessarily makes us an irresponsible person, the banks do see us as incompetent, leading to bad credit score.
This can have long lasting effects on our financial situation, especially when we need a loan. A bad credit score will get you rejected from all the banks and mainstream financial institutions. Fortunately, bad credit loan options are still available which can save you. Bad credit loans are provided by private companies to people with poor credit history. Although, there are some risks but only for undisciplined people, the advantages of bad credit loans are higher.
Higher Approval Rate
Credit Card and banks loans consists of a number of complicated procedures before your loan application is processed. Even after you take all the necessary precautions, your application can still get rejected. This ultimately wastes a lot of your time. However, bad credit loans have a high approval rate and you can get a loan within days of applying for it. Bad credit loans usually have 80% to 90% approval rating. This is ideal for when you need money for medical emergencies.
Borrow Large Amount of Money
One of the biggest advantage of taking a bad credit loan is that you can borrow huge sum of money. Sometimes, for medical treatment or surgeries, home destruction due to natural disasters or fire, we require large amounts of money urgently but it is impossible to get such kind of loans from state banks. On the other hand, bad credit loans can grant this loan so that you can overcome any hardship and get on with life.
Improve Credit History
Because you couldn’t get a loan due to poor credit history, a bad credit loan can help you improve it. If you make all of your monthly payments on time, you can increase your credit score. The companies will give you positive feedback and enable you to take bank loans in the future. Plus, since you cannot get any other loan due to bad credit score, this loan is your chance to improve credit history and consequently, your financial situation.
If you cannot get a loan from banks, one other option is to collateral something of financial value, such as your house or car. There are high chances that you will loose your collateral if you fail to repay the debt, which can leave you homeless. However, with bad credit loans you do not have to worry about collaterals and paying mortgages. You can get a loan without submitting collateral.