If you have a bad credit record and a bad credit score, getting a loan from a reputable bank or a financial institution may be difficult. It is because they view you as a high-risk customer who may not pay the money back. If there is no immediate need for cash, then the best thing to do is work on building your credit score. Eventually, with a good credit score, you will have increased access to loans, and that too at lower interest rates. However, if you have an immediate need for money, then you can try the following ways to get a short-term loan.
A payday loan is a short-term unsecured loan. The lenders do not usually conduct credit checks for giving payday loans; they rely on your employment and payroll records. You can get the cash you need now and pay back that principal of the loan plus any interest on your next payday when you have enough money again. You can approach a reputable financial institution in Canada, like Cashco Financial, for a payday loan. They will allow you to borrow up to $1500. All you need is an ID, source of income, and a chequing account. If everything is in order, you can get the money within minutes. You can even apply for a payday loan online by visiting www.cashcofinancial.com. Just fill in the application form, submit the documents, and the money can be transferred directly into your account very quickly.
It is an online platform that lets you borrow directly from an individual or an institution. The concept of peer-to-peer lending (P2P lending) started in the year 2005 and since has been gaining popularity steadily. In P2P lending, the P2P lending companies match the lenders directly with the borrowers. The entire operation is run online; hence the P2P lending companies can run with lower overhead. This allows them to provide their services cheaper, compared to traditional financial institutions. Consequently, the lenders often gain higher returns, and the borrowers can borrow the money at lower interest rates. Now, the P2P lenders also screen the applicants and check their credit. The catch here is that, since you are providing the reason as to why you need the loan, an individual lender may be more empathetic to your situation, and provide you with the loan. In effect, while your credit score is still a factor in P2P lending, you may still get a loan.
Find a co-signer
If you know someone who trusts you, knows about your situation, and willing to help you out, you may ask him/her to co-sign a loan with you, provided that person has a good credit score. However, it is very important that you make the monthly payments and repay the full amount on time; otherwise, the lender will ask your co-signer to repay the whole amount. For your co-signer, this would be devastating, and it will most definitely end the relationship with him/her.
Ask for a loan from your family/friends
You can ask for a quick loan from your family or friends. However, it is important that you consider this as a serious business transaction. You will have to clearly document it, and record it legally as well. This will avoid any future confusion, as to the interest rate, what would happen if you fail to repay the amount on time, the payment terms, and so on. The main advantage of treating a loan from your friends/family as a business transaction is that they will be more open to lend you the money.
There are various ways to get short-term loans even if you have a bad credit score, the catch is in finding the right one for you and making sure you don’t end up overpaying for it.