Only you know for sure what happened in your life that has made your credit score plummet to the level that banks refuse to consider your loan application. If you have moved past that part of your life now, you might be thinking about rebuilding your credit file, but have no idea, short of filing bankruptcy, how to go about it. Your ultimate goal to rebuild you new credit is to obtain a bad credit loan that can help you rewrite credit history, and your best shot at getting that loan is to apply for it online.
Although you may have become accustomed to rejection by lending institutions, there are special online lenders who work hard to service loans for those with damaged credit. These lenders have been known to sometimes provide funding for scores that are only in the 500s.
Check Your Own Credit
Before you make your application for your online bad credit loan, you should get a clear picture of where you stand financially by obtaining your credit report. Because there are three major credit bureaus, you should pull your report from all three to make a comparison.
Typically, each will have a different view of your credit. By making a comparison of the items that are being noted on all three reports, you can look for inconsistencies and errors. Check the balances that are noted for all accounts, and compare the figure to what you have on file. For instance, if you have a credit card with a $5000 limit, then each credit report should reflect that amount, as well as the amount of the highest balance you ran with the card.
This is useful in determining your credit available versus credit used ratio, which is an important factor that is considered by potential lenders when they decide to give you credit, and in what amount. Note anything that does not appear to be correct, or accounts that you do not claim as your own or do not recognize. Any erroneous information will be deleted within thirty days by the credit bureau that hold it, if their investigation provides evidence that the information is wrong, or that an account does not belong to you. You are legally entitled to one free copy from each bureau annually. You may have to pay extra to receive your FICO score.
Budgeting For A New Payment
Now that you have a clear picture of how your credit stacks up, make a budget to assure yourself that you are able to afford a loan payment. A simple budget is easy to draw up. First, determine how much income you have coming in each month; if you are married or share the bills with someone, you may include their income if they plan to help you repay the loan. Next, list every debt that you owe, including credit cards, loans, mortgage, etc.
You will not put an average on your utility payments, such as electricity, gas, water, telephone, and sewer service. Allow for food and other household supplies, as well as transportation to work. Subtract the amount you have going out in terms of income to the amount coming in. This will give you an idea of how much you can afford to pay each month for your new bad credit loan.
Get Your Loan
Once you have the figure, you can visit the online lender of your choice on their website. You will be able to apply online and receive your cash in minutes, usually delivered electronically to your bank account.
By applying for your online loan, you not only have a better chance to be approved, you will also have the satisfaction of knowing that you will be paying the least amount of interest possible on your new bad credit loan, which will save you lots of money.
