9 ways to get a personal loan with bad credit

9 ways to get a personal loan with bad credit

The term “bad credit score” can be quantified in many ways. For example, as per FICO ratings, a score of below 670 is considered poor. Likewise, VantageScore has its threshold at 661. A bad credit score greatly reduces an individual’s chances of getting loans from banks and other financial institutions. Nevertheless, there are certain borrowing avenues and ways to get personal loans with bad credit scores. Some of those useful options include: Make soft-credit inquiries This avenue is known as seeking prequalified loans from banks. Several lenders allow customers to submit prequalification online to let them see their estimated loan offers without affecting their credit scores. Soft-credit inquiries are effective for receiving a pre-approved loan from banks and other financial institutions that lend money to individuals. This process involves discussions with several potential lenders to assess one’s loan options. One must avoid making hard credit inquiries (loan inquiries in which lenders request to review the loan seeker’s credit report, as opposed to soft-credit inquiries that only involve talks), as that can further lower one’s credit score. Keeping personal identification handy Before agreeing to sanction loans for individuals, banks need them to reproduce their personal documents, including their social security number ID, driver’s license, W-2 forms from the previous two years, two most recent bank statements from all accounts, recent utility bills, mortgage statements, pay stubs, federal tax returns of the last two years, and other documents that verify one’s residential address, personal loan information, and overall contact details.
Read More