Nobody wants to get into bad credit, but circumstances in life won’t let you be. But you don’t need to get scared if you have bad credit, yet you need an emergency loan. There are still other loan options available at your disposal.
Here are some of the emergency loans you can apply for with bad credit.
If you have bad credit scores and want to sort out your financial emergency as soon as possible, a personal loan will come to your aid. You can make payment of this loan in installments. This can be 2-5 years, giving you a lot of time to collect yourself financially and be able to repay before the installment period elapses.
Luckily, some lenders offer a bad credit loan as a personal loan with flexible repayment plans. Before applying for a personal loan, ensure you shop among different lenders. You should ensure you only borrow from a lender with favorable terms.
Credit Union Loan
Get rid of your emergency by borrowing from a credit union if you’re a full member. Their loan terms and interest rates are very affordable.
Credit unions are generally nonprofit organizations that don’t benefit any third-party shareholders. They use their revenue to help their members by offering them loans at low-interest rates and fees.
These credit unions are guided by federal regulations, which dictate their maximum interest rates. Repayment periods start from one month to six months.
You have to be a member of a credit union for at least one month before applying for a loan. This makes it challenging to apply for an emergency loan if you’ve not been their member for the stated period.
Turn to Lending Circles
Don’t let an emergency turn your life upside down when there’s a nonprofit or community organization around you. In this type of lending, people come together, possibly in six to twelve groups.
They then take turns in receiving loans from each other and ensuring they pay them back on time. You don’t have to worry about interest rates since there can be none or, then it should be relatively low.
You can also build your credit if the organization decides to report payments to credit agencies. Getting involved in a lending circle is one of the headaches that come with this emergency funding type.
You don’t have the guarantee of receiving your loan immediately since you might be the first or the last to receive the funds. It might be too late to take care of your emergency if you’re the last person in the circle.
You can never run out of ways of solving your emergency with different loan types available at your disposal. There are various online lenders offering emergency loans on their websites.
They don’t have physical branches that you can visit, but they’re reliable. They provide more access to quick loans even if you have bad credit.
Their repayment terms and interest rates vary as some lenders charge annual percentage rates in the triple digits on their short term loans. You can as well avoid paying these many fees by checking on multiple lenders.