Online Bad Credit Loans

Getting a personal loan can be straightforward. You only need to meet certain requirements and have a good credit score. With those in place, you'll have the money in your account in no time.

But what if you have bad credit or no credit? Does this mean you can’t borrow money from a reputable lender?

Let’s get one thing out of the way. Lenders aren’t villains. They want to know that you can pay back what you borrow. In their mind, the higher your credit score, the more likely you can pay back the loan in full and on time.

But even if you have bad credit, don’t despair. You can find the right bad credit loan to meet your financial need.

This guide offers an in-depth overview of credit and credit scores and explains how you can fix yours. It also provides borrowing options to help you get the financial help you need. With this information, you can improve your credit and gain access to funds.

The following explains issues that could lower your credit score.

Failure to repay your loan could result in repossession. This happens when a lender takes property back from you for non-payment. Repossessions benefit no one. They're costly for the lender. And they leave you without a place to live or a means of travel.

Adding insult to injury, a repossession can drop your credit score by up to 100 points. Furthermore, late payments and collections leading up to that repossession stay on your credit report for seven years.

It's best to avoid repossession at all costs. And the best way to do this is to pay your loan on time.

If you fall behind on payments, reach out to your lender at once to work something out. The lender might be willing to refinance your loan. Or you could work out a deal to sell the property and use the proceeds to pay off the loan. But ignoring the situation guarantees a poor credit score.

Medical bills are a little different. They only impact your credit if you fail to pay and collection agencies become involved. The good news is that the credit bureaus require 365 days before the debt shows up in your report. But once that information appears, it stays for seven years.

Another issue is that "late payments" vary based on the health care provider. Some might want payments within 30 days. Others might wait for 90 days to get the collection agencies involved. Be sure to understand how your healthcare provider defines late payments.

Even one late rent payment can drop your credit score. What is "late?" A late payment is anything after 30 days. Federal law prohibits reporting a late rent payment until after that 30-day window. But once the information appears, it stays on your credit report for seven years.

Your on-time payments make up 35% of your FICO score. Skipping even one payment can reduce your credit score. Additionally, late fees and penalties can add to the problem. If you think you might not be able to make a credit card or loan payment, don't ignore the situation. Reach out to the lender or creditor at once.

Another way to take care of your credit score is to avoid credit mistakes. Here are eight of the most common.

You can access your credit reports from all three bureaus for free once a year. Take advantage of this to view your credit history and payments. Consistent monitoring also helps you spot errors. You can then correct them before they impact your credit score.

We've said this before. On-time payments comprise a large part of your FICO score (35%). As such, you must pay on or before the due date. Set up automatic payments if you tend to forget. And reach out to your lender or creditor if you need help.

Applying for a lot of credit or debt creates two problems. First, it suggests you might be taking on more than you can afford. And second, each credit card application or loan request generates a hard inquiry on your credit report. Too many of these can mean a lower credit score.

Just because you have credit doesn't mean you have to use it all. Credit utilization is another critical metric on your credit profile. Maxing out your credit cards increases utilization and lowers your score. The rule of thumb is to use less than half of your available credit. Even better? Strive for a 30% or less utilization rate.

Making minimum payments on your credit cards does prevent late fees. It also won't impact your credit report. But paying just the minimum doesn't stop interest from mounting. This increases the amount you owe, making it harder for you to pay off your debts.

It might be tempting to close that older credit card account once you pay it off. Don't do that. Another important credit score factor is your credit accounts' ages. Lenders like older accounts because they show your ability to pay off debt over time.

Here's an important rule: Use credit cards for credit only. Do not use them for cash advances unless you have no other choice. These advances come with upfront fees, as well as daily interest charges.

Using your credit card to get cash back on purchases or free airline tickets might seem like a great idea. But it really isn't. You could end up buying more than you need just to get those perks. These "rewards" could lead to overspending, increased debt, and a lower credit score.

By now, you know that it's possible to rebuild your credit fast by paying debt on time and rebuilding your credit scores. But you might need money now. Perhaps you need emergency funds or need cash to cover unexpected legal fees. You might need to replace a broken hot-water heater or fund a dream vacation. The good news is there are loans available for bad credit. Finding those opportunities requires legwork and research. But it is possible to find the easiest loan available for your specific situation.

Here are some great loan options if you have bad credit.

With online personal loans, the entire borrowing process takes place online. You don't have to set foot in a bank for paperwork, prequalification, or approval. You can complete the application process anywhere and at any time and get quick approval.

Online loans are available from lenders like Jora Credit or even traditional banks. You have many online loan options, too. Online loans include installment loans, cash advances, title loans, no-credit-check loans—and more.

Keep in mind that not all online loans are ideal for those with bad credit. Another thing to consider is that interest rates might be higher. Before applying, make sure your targeted online lender provides loans to consumers with bad credit.

With a no-credit loan, the lender doesn't need your credit score for approval. The focus here is on your income and earnings versus your credit history.

The process means you can avoid a hard credit pull, lessening the chances of lowering your credit score. No-credit loans also have a quicker approval process. Repaying the loan on time also helps your credit score.

But there are some downsides to this bad credit loan. The lender takes more risk, which means higher interest rates and fees for you. Additionally, there's no guarantee that the lender will accept your application. An unstable employment history or low income could lead to rejection.

Payday loans, also known as cash advance loans, are short-term, smaller loans that are less than $500. They’re called “payday” loans because you repay them in full when you receive your next paycheck. The advantage of a payday loan is that there are few requirements. All you need are an active bank account, proof of income, and an ID. Approval can also be quick.

But this type of loan has several downsides. Many payday loans carry triple-digit interest rates. Failure to immediately pay off the loan could trap you in a horrible cycle of escalating debt.

Even after this, you might be asking yourself, “where can I find payday loans near me?” One way is with Google. But don’t go with the first company that pops up.

Payday loans can be a solution for quick cash. But be sure to pay the loan in full by your next paycheck to avoid high interest rates.

An installment loan is a lump sum you borrow for a particular purpose. An auto loan is a type of installment loan. So is financing you might apply for when buying furniture or appliances.

Upon receiving the funding, you repay a certain amount over a set period until you pay off the loan. Banks and finance companies offer loans, as do online companies like Jora Credit. Installment loans can help you budget, as the weekly or monthly payments don't change, and approval is quick. If you have bad credit, a lender might also examine other factors like employment history and income.

Jora Credit's installment loans don't always require a credit check—but others might. Keep in mind that a hard credit pull could lower your score. Additionally, some installment loans might carry high interest rates.

If you can't get a personal loan because of bad credit, consider a secured loan. This is a loan "backed" by collateral. Collateral is a physical asset you own, like a car, bank account, life insurance policy, or other valuable items.

Many lenders regard secured loans as less risky than other types. If you default on payments, the lender can take possession of the asset, and sell it to recoup the investment. Because of this, interest rates might be smaller.

But applying for a secured loan doesn't mean you'll get it. The collateral you offer might not be useful for the lender. Additionally, not all secured loans are available to those with bad credit.

You also need to make sure you can pay off the loan. Even missing a few payments could result in repossession of your collateral. Repossession can hurt you financially and harm your credit score.

By now, you might be feeling a little better about your borrowing prospects, even if your credit is poor. But beware. Scammers regularly target vulnerable individuals with illegal or non-existent bad credit online loans.

Here are the red flags to watch for when researching bad credit online loan options.

Let’s say that one day you go out to your mailbox and find a letter from a local “lender" with some good news. You're automatically approved for a loan!

Sound too good to be true? It is. This "lender" is a scammer trying to get your personal and financial information. No reputable lender ever promises upfront approval without extra information from you. Any lender worth its salt wants assurances that you can pay off a loan, even with bad credit.

So, if you receive a notice of "guaranteed loan approval" via snail mail, email, or text, get rid of it immediately.

Don't trust any "lender" that emails, mails, or cold calls you out of the blue. These bad actors, unfortunately, target bad-credit borrowers with "too good to be true" offers.

It's easy to throw away something you receive in the mail or to delete an email or text. But if you receive harassing calls, sign up for the National Do Not Call Registry. Also, check with your state's attorney general's office to determine the next steps.

Above all, don't engage with these companies in any way.

Borrowing money is a big step. It requires consideration, research, and clarification when there are questions, and reputable lenders understand this. They give you the time and space you need to decide, and they're also available to answer concerns.

Fraudsters and scammers have no such intent. Their goal is to get you to sign on the dotted line as quickly as possible. Any company with a hard deadline ("this deal only lasts until tomorrow") is less of a lender and more likely a scammer.

Reputable lenders must register in the states where they do business. For instance, Jora Credit is licensed in the states in which it conducts business.

Most lenders will register with a specific agency (such as the secretary of state). Those that don’t are likely fraudulent companies and scammers. If you find a lending company without state registration, that company violates the law. This means you have no recourse should that company cause you harm.

It’s easy to set up a website and P.O. Box number. Unfortunately, these are part of a scammer's successful toolkit. Legitimate lenders—even those that operate 100% online—have physical addresses. The addresses are prominently displayed on websites and are easy to find.

That physical address should also be accessible through Google Maps or Apple Maps. If the location is in a house or residential neighborhood, this could also suggest potential fraud.

The lender you work with must have a secure website. A "leaky" site means a higher risk that a hacker will make off with your data.

There are two ways to determine if a lender's website is secure:

• The website address starts with "https" rather than "http." That extra "s" stands for "secure."
• Website pages have padlocked symbols. That symbol means the web page you're visiting—and are entering information into—is secure.

You don't have to pay anything upfront to a lender. You're looking at fraud if a "lending" company requests money from you before you even begin the loan process. Don't buy into the story that the company needs that money to cover processing fees or other costs. Be wary of any pressure.

A reputable lender will outline any extra costs during the application process. You pay those costs only after the loan's approval and funding, not before.