Having poor credit diminishes one’s ability to procure a loan and also renting an apartment or landing a job etc. People with poor credit have low credit scores. A credit score is a number that lenders (banks and credit cards etc.) use to identify the risk element of lending money to you. The standard credit score is called FICO score, named after the Fair Issacs Corporation which created this. Credit score usually range from 300 to 850; the higher your score the better is your credit. Credit scores are determined by factors such as: Payment history – Lenders see how consistent you have been in previous loan repayments. Outstanding amount – Those carrying a lot of debt are considered risky and is less likely to pay back new loans. Length of credit history – If you’ve been a long time borrower and a responsible one, the higher the score. Types of credit in use – Credit cards, personal loans, mortgages etc are the kind of credit a person may already have. New credit – Your credit score may lower if you apply for too many loans within a short span of time. The obvious solution to having poor credit is to improve your credit score.

Applying for a loan is a brain wrecking process in itself with all the paperwork and jargons involved. This becomes even more difficult if you have a poor credit score. Credit scores range from 300 to 850. Having a FICO score of 579 and below means you have poor credit score. A FICO score of 580 to 629 means you have a bad credit score. To qualify for loans, your goal should be to improve your credit score (ideally it should be above average, i.e. FICO score of 630 and above). Other than credit score, other factors like debt to income ratio, determine the terms of your loan. Having a poor or bad credit score almost always means a higher interest rate. If you have poor credit, but have a steady income and low debt levels, the probability of you securing a personal loan is higher. As a borrower, you may have bad or poor credit due to one or more of these reasons: Default in making any of the repayments Shopping extensively for a loan but getting rejected repeatedly. Has never taken a loan in the past and there’s no credit history to validate. To procure a loan in spite of having poor credit:

Financial hardships arising from being unemployed can be avoided by applying for specific loans for unemployed or seeking federal unemployment benefits. The government also offers loans to individuals as a means of financial assistance. The loan, per usual, has to be repaid its interest. Applying for unemployment benefits or worker’s compensation has its own set of stipulations and the eligibility criteria are determined by state law. Procuring an unemployment loan might prove quicker in many cases. Financial assistance during this time of crisis may come from various sources, such as: Friends and family Shout out for help, just do Using credit cards to get a cash advance – Albeit being a quick way to get cash, the interest rate is usually high. Borrowing against your home insurance – If you have decent real estate equity and some form of income, like unemployment benefit, this may prove to be a viable option. This loan is like having a revolving credit card debt. It is usually mid to long term loan. Borrowing against your life insurance – If your life insurance policy has a provision, you might be allowed to borrow a small sum of money against it. Applying for a loan with co-signer – A friend or family member with a good credit score as a co-signer, might up the probability of you procuring a loan.

To save money on your loans, use the various loan calculators available online during the preparatory phase. Using these calculators gives you an idea of how much you can afford, how much you can borrow and an approximate monthly repayment figure. Personal loan calculator A personal loan is an excellent tool to revive your finances, like consolidating your credit card debt and to meet the exigent needs. Personal loan calculators available online, use interest rate, loan term and principal amount as variables to calculate the total loan repayment amount. Interest rates vary from lender to lender. It is possible that some online lenders do not consider any fees that may be a part of the loan. The purpose of the personal loan calculator is to estimate monthly payments and total interest paid. Use the available online tools as a part of you loan pre-work and not as an abiding agreement. Student loan calculator When it comes to repayment of student loans, the annual salary required to match the monthly loan repayments has to be considered by the student borrower. Some federal student loans require a fixed minimum monthly payment, like 50$. Separate calculators are available for those with multiple student loans (look for Weighted Average Interest Rate Calculator).

Traditional banks, as well as credit unions, have changed their standards of loan lending, which has made it a bit difficult for small business owners to get funds. If you are a small business owner, you should be aware of the factors which determine your chances of landing a loan for your company. Following are some important aspects that can help you get small business loans easily. Credit score As a small business owner, it becomes imperative to keep your personal credit score as high as you can. However, small business loans usually consider the personal credit score of any business owner which maintains for about 20 percent or more interest in the company. By using the current alternative lenders, a borrower usually gets a loan with a credit score that could be as low as 500. The best rates for small business loans are provided to the borrowers who have secured an excellent credit score (720 or higher). Borrowers having a high credit score usually visit their local bank and get qualified for a loan. Several people with low credit still make use of alternative lenders. This happens because of the quick and easy funding. Loans for the low credit borrowers are usually in the form of an Automated Clearing House (ACH) or Merchant Cash Advance (MCA).

The home equity loan is when the borrower uses the home equity as collateral for a loan. The property value determines the loan amount. A professional appraiser determines the value. This loan is taken by the homeowner usually for a major repair, medical bill or college education expense. This loan is taken against the value of the home and in fact, reduces the value/equity of the house. These loans require that you have a good credit history, reasonable loan to value (of the house) and combined loan to value ratios. There are two types of home equity loans, a closed end which is called a home equity loan and the other open end which is a home-equity line of credit. These are also called second mortgages (secured against the value of the house). The home equity loans can be considered as the person’s main mortgage. You cannot purchase a home using this loan or refinance. In most cases, the home equity loan interest can be deducted from the personal income tax. The home equity loan is a one-time credit given in lump sum at a fixed rate of interest. A list of fees that may be applicable for home equity loans is appraisal fees, originator fees, title fees, stamp duties, arrangement fees, closing fees, early payoff fee, inactivity fee, annual or membership fee.

A credit score is an indication of the financial status of a person or a company. The credit score can either be categorized into a high score or a low score category depending on how much credit or debt is due. A good credit score is high. It gives investors a guarantee that the person will pay their dues diligently. It builds a steady and trustworthy relationship between the two parties. Bad credit loans or poor credit loans, on the other hand, have a low credit score, indicating that the person has not been paying his/her dues promptly and that the probability of default is higher. It is risky for investors to invest in people with bad credit ratings. In the United States, the Fair Issac Corporation (FICO) is responsible for calculating credit scores. To do this, it receives information from three credible sources namely Transunion, Experian, and Equifax. It strategically weighs out the information obtained to calculate the credit score. The scoring range is from 300 to 850. Any score below 579 is said to be a bad credit score. A high percentage of people have shown to delay payments with bad credit ratings. Bad credit loans default many a time.

Unforeseen vehicle repairs or medical expenses are bound to happen just when your savings have hit rock bottom and when there are no more sources of loans available. Or so you thought. Short term loans with no credit checks provide instant cash. If you have a low credit score, when getting loans from most lenders is next to impossible, a loan with no credit check is a boon. Before lenders provide money to borrowers, they perform credit checks, which in fact further lowers the credit ratings of the borrower. But lenders who provide short-term loans with no credit check only perform a soft credit check, and this has no impact on the borrower’s credit score. But when only the ability to repay the loan in full, within the agreed period, is the criteria for a short-term loan with no credit checks, then it becomes the only solution for someone in urgent need of money. Safe, secure and most convenient, short-term loans with no credit checks come with quick approvals where the borrower is asked to submit a simple application online. Upon checking eligibility, lenders discuss the loan terms and after approval, the loan money is transferred directly to the borrower’s bank account.

If you get a student loan forgiveness, then you can end up saving on thousands of dollars from student loans. If you take up a job in public service, then you may qualify for a Public Service Loan Forgiveness. Here are some important tips you need to know about Public Service Loan Forgiveness. Public Service Loan Forgiveness is essentially a federal program forgiving federal loans of borrowers who work full-time in a federal, state or local public service job and make at least 120 on-time payments (this roughly equates to 120 months of student loan payments made on-time) This program is eligible only for payments made after October 1st, 2007. Any payments made before this day will not add up to the 120 payments. As a borrower, you can make the 10-year student loan repayment using any of the following repayment options: standard repayment, Pay As You Earn Repayment (PAYE), Income-Contingent Repayment (ICR), Income-Based Repayment (IBR). You can improve your chances of being eligible for a Public Service Loan Forgiveness by making most of your 120 repayments using an income-driven plan. The direct loans that are eligible include Federal Direct Subsidized Stafford/Direct Loans, Federal Direct Unsubsidized Stafford/Direct Loan, Federal Direct PLUS Loans (for parents and graduate and professional students), Federal Direct Consolidation Loans Only two types of student loans, namely:

Payday loans are sometimes necessary for people who have bad credit ratings or have an urgent need for cash due to emergencies. There are several companies which are willing to offer fast cash loans to people who need it. The following are some of the most reliable and most popular payday loan companies: CashNetUSA : It is a payday lender. Consumers can receive cash within one business day. The company is transparent in its policies and provides thorough information on rates of interests and other protocol.   Check Into Cash: They have a huge number of stores all across the United States, approximately 900 stores across 30 states. They not only offer online payday loans but also title loans and provide a quick solution for your needs.   Speedy Cash: As the name suggests, Speedy Cash specializes in short-term lending and financing. They also help in the financing of small businesses. Business in rapid cash is done in Nevada, Oregon and Washington and they operate in cash money in Canada.   TitleMax: The company was founded in 1998 and has around 1110 stores in seventeen states. They offer loans for vehicles as well as personal loans.   LoanMart: They do business in eleven states and offer features such as an in-house DMV so that customers can receive their cash without any hassles or difficulties.

A promissory note is a legally binding document attesting a relationship between a lender and a borrower. It works as a promise to pay the loan amount as well as the interest within a specific period of time. A promissory note must answer six most important questions, as listed below. Who are the parties involved? The promissory note must mention who is being repaid (lender) and who is repaying (borrower) the loan amount. Check with your state law and confirm which parties need to sign the promissory note. Usually, it is just the borrower. However, it is considered a good practice to have it signed by the lender too. How Much Money Needs To Repaid A promissory note must clearly mention the principal amount that is being borrowed as well as the interest percentage that needs to be paid. How Is The Money Going To Be Repaid The promissory note must mention clearly as to how the money is going to be repaid to the lender. It needs to state if the money is going to be repaid in installments, in installments with a balloon payment, in a lump sum or on demand. When Is The Money Going To Have To Be Repaid A specific date for repayment has to be included in the promissory note.