Having bad credit can take a serious toll on a person both financially and personally. Credit checks seem to accompany everything from job applications to registering with a utility company these days. This is why many people with bad credit fear a time when they may need to take a personal loan to stave off certain disaster. The good news, however, is that there are in fact several lenders online who are willing to help you find a personal loan in amounts up to $5,000 despite a bad credit history.
Why Bad Credit Happens
There are several reasons as to why someone ends up with a poor credit score. In many cases, mistakes were made when you were young or an unexpected emergency, such as a medical issue, plunged you into debt that you could not avoid. It is difficult to get out from under this kind of financial pressure, but it is also a common problem among people today. Whether your bad credit is a result of poor judgment, bad timing or any other factor, there are lenders who understand and will work with you to get the loan you need.
Over the past several years, online lenders have filled in many gaps for those with bad credit when it comes to finding a personal loan to help them through a financial hard time. Unlike the process of getting money from traditional sources, such as your home bank or local credit union, who are far more likely to say no to your credit application, online lenders specialize in serving those with poor credit in the past but who have hope for the future.
Reasons to Take a Personal Loan
There are many different reasons that an individual may have for taking a personal loan. Sometimes you are looking to consolidate debt as a means to improve your credit score. Other times, there is a medical emergency or car repair issue that needs to be taken care of immediately. Sometimes people simply take personal loans to finance luxury items such as vacations and weddings because the interest rate is lower than that of a credit card.
Regardless of the reason that you have for seeking a personal loan, online lenders will work with you. That is because they will generally not ask questions about intent as long as the loan amount is $5,000 or less.
Two Loan Options
If you decide that looking online for a personal loan is a good option for you, then there are two main choices that you will have in that respect. The first is to get a secured loan. These loans are taken out using collateral, such as a home or car, and are generally offered at lower interest rates. This is because the value of the collateral insures the value of the loan and gives the lender some additional assurance that you will repay the money you owe.
The other option is an unsecured loan. People who do not own property will need to avail themselves to this option. Because unsecured loans lack the guarantee offered by collateral, they will carry higher interest rates.
Getting a Loan with Bad Credit
Regardless of the reasons for your bad credit, the reasons for your loan, or the ultimate loan that you choose to take, it is nice to know that those with bad credit have the option of getting a personal loan online for up to $5,000. You can start your search today and have the money you need with little hassle and little worry.