How to Get a Loan with Bad Credit
When you have bruised or bad credit, it can seem nearly impossible to get a loan from the bank. But if you want to learn how to get a loan with bad credit, we can help you understand what steps you need to take — plus help you fix your credit in the process.
When you bruise credit, it takes time, positive payment habits, and good credit behavior over an extended period for most lenders to help you again.
Before you can begin credit repair, there are some items you must take care of first:
- Bad debt has to be cleared.
This can be achieved through paying your debt in full, settling with your creditors (potentially through a consumer proposal), or filing for bankruptcy. But regardless of the method you choose, if you still have bad debt to your name, it’s highly unlikely the bank will say yes.
- Equifax must be notified.
Even after you’ve paid off your bad debt, don’t assume that your creditors will notify the credit reporting agencies. It’s your responsibility to contact Equifax and update them on your new information.
- You must establish new, good credit.
After your bad debt has been paid off and Equifax has been notified, it’s time to start rebuilding your credit. Initial steps are to establish positive payment habits, such as paying your bills on time and in full, not maxing out your current credit products, and not applying for too many new credit products.
If you follow all of the above steps and don’t accrue anymore bad debts, the bank will usually start to stay yes to your credit requests about two years from when you have resolved your problem credit, with two years of rebuilt positive credit.
This means you need to:
- Pay off your debt bad debt and then
- Re-establish good credit for two years.
To start your credit fix, you may need to take out a new credit product — such as a secured credit card or a loan from a lender who works with people with bad credit. If you go this route, be sure you are choosing a lender who reports to the credit agency (no payday loans) and make sure you have a good plan in place to continue practicing positive payment habits.
Even when the bank says no, there are other lenders that say yes. At Prudent Financial, if you have equity in your home or vehicle, we say, yes often, regardless of your credit score, and help you learn how to fix your credit in the quickest way possible.
Learn more about our loans for people with bad credit today. Visit www.prudentfinancial.net or call 1-888-852-7647.