Bad Credit Auto Loans after Repossession or Bankruptcy

For a guy like me who has spent more than two decades in the loan business, it’s still hard to imagine a type of loan where absolutely anybody gets approved. But the fact is there are bad credit auto loans that absolutely anyone can qualify for. I suppose that’s not such a bad thing. If people can’t get reliable transportation, they have a very hard time keeping steady employment. I don’t want more people in the welfare offices just because they had a repo a couple years back and now they can’t get a loan to buy a car.

But if you have damaged credit and you’re looking for $5000 auto loans, you probably have a few questions, and I’m guessing two of the more commonly asked ones will have to do with repossessions and bankruptcy.

First, repossession. Yes, there are lenders who won’t mind a repossession, even if it happened in the last year. But there will be some conditions. The repossession can’t have been part of a bankruptcy, and there still technically needs to be a balance on the account (even if you’re not making payments anymore). If you’ve had a repo you’ll have to bring a bigger down payment to the table, and lenders aren’t going to want to finance an old clunker, so you’ll need to buy a more recent model car that still has a warranty in effect. Make sense, doesn’t it? If you flake again and they’re left with a car, they want one under warranty so they can fix it for free (if it needs repairs) and sell it at a higher price.

And what about bankruptcy? Yeah, you’ll still be able to get financed even if you have a bankruptcy on your record. But again, some conditions. One, the bankruptcy will have to be complete and discharged. They don’t want you applying for a loan while you’re in the middle of asking the courts to let you off the hook with the rest of your debt. Second, your bankruptcy trustee will have to give you a document called an Authorization to Incur Debt for you to include with your application. That pretty much explains itself doesn’t it? If you’re bankrupt and looking to borrow more money, the lender is going to want to know that you have permission from the folks who handled your bankruptcy.

This topic isn’t a glamorous one, I know. But you, and millions like you, are in the dog house with the credit agencies right now. You still need transpo to get yourself here and there, and you need an opportunity to borrow some money so you can make payments and rebuild your credit. No credit check auto loans with repo are a great tool to get the process going.

Unsecured Personal Loans for People with Bad Credit

It’s a sick feeling to see your bank account go to zero when you still have plenty of month and plenty of bills left. When I was getting my first business started I had that experience plenty of times, and I hated it. Fortunately I could rely on my credit cards to get my through during those times, but I know many people who read this won’t be in a similar situation. For many of you, unsecured personal loans with bad credit will be the only real option.

At the same time, I don’t want to make it seem like getting a bad credit unsecured personal loan is the end of the world. It might be exactly what you need to put food on the table, make some emergency repairs to your car, or buy your son or daughter some clothes they really need for their latest sporting event or school activity.

The only reason anyone gets upset about these kinds of loans is that there’s a real stigma associated with debt, and especially debt that comes with steep interest rates, as an unsecured bad credit personal loan will. Even I’m a little judgmental of people who need these loans at times, because I really hate the idea that through some lack of personal discipline or planning you’d have to pay triple-digit interest plus fees just to make your bills work for the month. But I do realize that there are times that people just have an awful string of unlucky events in their life which no amount of preplanning would have prevented.

For those situations it’s actually fortunate that people can borrow these short term loans. I’d guess that many people who do use them only end up having to go through the process once, and the feeling of paying such exorbitant interest and fees would be enough to keep them from going through it again.

Just so you’re clear on the process, an unsecured personal loan – with bad credit – is going to require certain things from you such as:

  • proof of a job you’ve held steadily for several months.
  • proof that you earn at least $1,000 to $2,000 per month at that job.
  • an open, active bank account.
  • direct deposit of your paychecks to that bank account.

If each of those criteria are in place, getting your loan approved for as much as a few hundred or even a thousand shouldn’t be out of the question. I hope you’re able to take care of whatever circumstances created the need for this loan, and I hope you don’t find yourself needing one again.

Bad Credit New Home Loans

Buying my own home for the first time was one of the most exciting experiences of my life; I had rented for years with my wife, and now we were ready to buy our first home. Our credit was relatively good, but I realize that’s not the case for many people out there who are hoping to live the dream of home ownership in spite of their damaged credit. They’re looking for bad credit new home loans.

Now, there are certain aspects of new home loans with bad credit that are universally part of home financing.

First of all, you have the typical facts relating to the home itself and the purchase price. Whether you’re a good credit or a bad credit borrower right now, the loan to value ratio (LTV) is going to be a major factor in whether you successfully finance the home. Banks are going to run screaming from almost anything but an 80% or lower LTV right now (yeah – they’d really prefer to see 70% or 75%).

Then you have the down payment. Even if you happen to be buying a home where the LTV is low due to the purchase price being low relative to the appraised value, most lenders are going to want you to have some ‘skin in the game’ in the form of a down payment. This will be especially true if you’re trying to get a new home loan with bad credit. Personally, I think it’s important for you to put a down payment on your home. During the few years there where the lending industry went completely insane, way too many people were able to buy expensive homes without ever sinking a single penny of their own money into the deal.

When you don’t have to put any money down I don’t think you’re fully prepared to make the mortgage payment when it arrives. It’s as though you got a ‘free house’ and I think that’s the wrong frame of mind to be in when you’re taking on such a major expense.

If your LTV and down payment are squared away, the final major consideration for the lender will be your income relative to your total monthly debt payments, factoring in your new mortgage. Lenders these days are going to be very stingy about letting that number go above 28%, and they’ll be very leery of any borrower with lots of unsecured debt, namely credit cards.

Getting a bad credit new home loan can work out for you, but you may have to spend a couple of years making yourself look better on paper so you can qualify, but do it with the best possible terms. The preparation process will actually be one of the most valuable experiences you go through in your financial life.

High Risk Business Loans to Keep Your Business Afloat

Running a business, no matter how simple it seems like it should be, is an extremely complicated process. Most of the time you hear people talking about how hard it is to get a business off the ground, and how such a high percentage of businesses fail in their first couple of years of existence. What you don’t realize is that many business struggle just as badly when they experience a little bit of success. Cash flow management is not an easy thing to do, and even business with steady sales find themselves short of money at times, and that’s when high risk business loans may be the only thing that keeps them alive.

A high risk business loan is actually a pretty risky prospect on both sides of the table. On one side you have the business owner who is an extreme cash crunch. They’re not even sure about whether their business will survive, let alone whether they’ll be able to pay back the loan.

The other party is the lender, and they’re extending this credit to what could be a sinking ship with no hope of recovery. You might ask yourself why these lenders would take this chance at all. Well, like all lending situations, they make the loans because they know the statistics of their business. If they charge high enough interest rates, and require enough of a down payment, they’re business can stay profitable.

The amount being lent in with high risk small business loans depends completely on the size of the business, in terms of sales, and the amount of cash they can put down on the loan. The more they can prove in terms of monthly sales, the bigger the loan they can qualify for.

You’ll notice I haven’t mentioned anything about credit score with these kinds of business loans. The fact is lenders in these situations don’t usually look at the credit-worthiness of the business owner, they just look at the business characteristics and make their decisions based on whether they think the business can handle the loan.

Business owners who have to use this kind of financing to keep themselves afloat should take it as a serious wake up call. They need to manage growth carefully with an extreme bias toward liquidity. Business ownership and personal finance have this in common – running out of cash is the absolute worst thing that can happen to you.

Unsecured Loans for Poor Credit

Every door in the world of borrowing and finance doesn’t close to you just because you have bad credit. In fact, I’d guess that a high percentage of loans – maybe even 30% to 40% of loans across the board – are given to people that most of the credit world would call ‘credit challenged.’ You have all kinds of loans specifically geared toward bad credit, including home loans car loans, credit cards…you even have unsecured loans for bad credit.

Now, that’s not to say it’s easy to get unsecured loans no credit check. It’s actually going to be pretty tough. Put yourself in the shoes of the lender, and think about what kind of person you actually want to lend money to.

As a banker, you’re looking for somebody to who’s highly likely to pay the money back. Now, given the fact that you don’t know the people who are walking into your lending institution on a daily basis personally, all you can do is work from the most common source of information on a person’s track record – their credit score. But in the case of unsecured loans with poor credit, you don’t even really get to use that. Folks looking for these kinds of loans look bad on paper.

The whole problem is that the big banks employ huge teams of statisticians who build massive actuarial tables, and the job of those tables is to say “given this person’s credit score, how likely are they to repay a (for example) $1500 loan?”

For a bad credit borrower like you, those actuarial tables say “he’s not very likely to make his payments on time, if at all.”

So how is the banker going to lend you the money? He has to do something to make sure his overall lending practices stay profitable, so the only way he can give you an unsecured loan for poor credit is to change what those tables say, and he does that through high interest rates and fees.

See, what they do is look at the repayment patterns of all borrowers of approximately your credit standing (aka not so great) and they look at what percentage of the time they bail out on the debt. Once they have a pretty good idea of the default rate, they raise the interest to the point that the interest paid by those who do make their payments more than covers the lost money on those people who flake. Make sense?

So, if you do happen to qualify for bad credit personal signature loans, you’re going to be offsetting the costs of other people’s unwillingness to pay their debts. It’s not ideal, but I guess you do what you have to.

Poor Credit Business Loans

It takes money to get a business off the ground. How much money? Well, usually more than you think…and more than most banks are willing to lend you. It sounds a little harsh, but if you’re looking for startup capital, bank loans can be a very tough route to financing. Some would say impossible. If you’ve damaged your credit at some point, it’s going to be very very hard to get poor credit business loans.

So, the first thing I’d say about this subject is that if you’re looking for business loans for poor credit, open your wallet and look at Mr. Visa, Mr. Mastercard, and Mr. American Express. Credit cards are really the only poor credit business loan I know of.

Now, if you already have a business up and running – and it has consistent sales – you might have a slightly better shot. Banks are much more amenable to the idea of lending money to a business to help it grow (as opposed to lending for the purpose of getting it started). So, if you have a year or more of sales data, and you can show other factors that will give your business a further sales boost (like a new website or a recently launched direct marketing campaign), it’s possible you’ll get a loan in spite of your credit.

I recently learned about another alternative to business loans for poor credit; they’re called cash advances for business and you qualify for them strictly on the basis of your sales credit card receipts. In other words, when you go to apply for this cash advance, all the lender will want to see is several months’ worth of credit card receipts from your business, and then they’ll basically lend you money against your future sales.

The rates and terms on these cash advances can be a little steep, so you have to ask yourself how bad you need the cash, and how much it will really help your business grow. If this small cash infusion is the last obstacle between you and a growth spurt, I say go for it.

Low Interest Unsecured Loans

The definition of an unsecured loan is a loan where no collateral is required as security for the lender. There are kinds of unsecured loans out there, including credit cards, signature loans, and even certain kids of personal loans. The trick is that low interest unsecured signature loans are hard to come by unless you meet a pretty specific set of criteria.

The first criteria you’ll have to meet if you want to get an unsecured loan with low interest is a good credit score. I know you’re used to seeing a thousand marketing messages a day that say you’re credit doesn’t matter and ‘everyone qualifies!’ but that’s just not reality.

If you walk into the average bank or credit union and ask for a loan or a line of credit that doesn’t require any collateral, their first move will be to look at your credit report. If they’re going to hand over hundreds or thousands of dollars with nothing guaranteeing their money except your signature, they’re going to want to see that you have a basically spotless credit history.

And not only that, they’re going to look at your total indebtedness. Lenders have statistical tables that tell them what happens to the default rate when a borrower’s monthly payment to monthly income ratio passes a certain percentage. If you’re anywhere close to that percentage you don’t have much chance of getting an unsecured with a low interest rate, or any interest rate.

There’s a reason banks tend to be so profitable – they’re very cold and calculated about how they handle their loanable funds. If you don’t meet the profile they want, no loan for you. And that’s regardless of a pretty face, or a charming smile, or a promise of “I swear I’ll make my payments on time.”

The fact that they act this way is probably in everyone’s best interest. After all, they’re using years and years of statistical data to decide what a borrower can handle. You’re using nothing but your skewed view of yourself and your emotional attachment to whatever you’re hoping to buy. It’s a case of the bank knowing what’s better for you than you do, and you should just trust the system.

At the same time, if you do happen to qualify for instant decision unsecured personal loans, use it wisely and make your payments on time! The more consistently and intelligently you use credit, the easier it will be to get the bankers to trust you. Comes in real handy when you want to do fun things like buy a new car or your very first home.

Debt Consolidation Loans for Bad Credit

“Consolidation” is term you hear all the time in the world of loans and financing, but you may not be aware of exactly what goes into debt consolidation loans for bad credit. Although I’ve never had the need to go through the process myself, I wanted to be able to put together a good article to let you know what you’ll be facing if your unsecured debts and credit cards become too much for you to handle.

In order to research this article I took the time to work through an application on one of the more popular debt consolidation sites, and here’s what I found:

First, they asked me a series of questions about my current financial situation and my debt. For example:

  • They wanted to know where I am with my monthly payments and other bills (can I keep everything current easily, are things getting tight, or are the creditors starting to ring my phone off the hook).
  • They wanted to know the main reason I’m looking for a debt consolidation loan with bad credit in the first place (unemployment or reduced employment, death or divorce of a spouse, unexpected increase in expenses…things like that).
  • Finally, they wanted to pull my credit report to see exactly where I am in terms of my debt and interest rates. I’m sure they take that information and plug it into a formula to determine whether I’m a good candidate for their program.

I’ll tell you that my general sense of this company, and of the debt consolidation industry in general, is that they really want to help people. They’re not the ones burying you in debt; they’re the ones trying to help you get out from under the debts you have. It’s nice to see that there’s a company in the financing industry that actually has people’s best interests in mind instead of trying to make them even worse off.

When you go through a debt consolidation program I would also strongly suggest that you take advantage of their credit counseling program. You got into a situation where you need a debt consolidation loan with bad credit due to lack of discipline, lack of education, bad circumstances, or probably a combination of all three. A good credit counseling and personal financial management course will protect you from ever having to go through something like this again.

How to Get a Home Loan with Bad Credit

Here’s the scenario: you’ve messed up your credit. A couple years back, after an on the job injury, you couldn’t work for six months and things piled up on you fast. Before you knew it you’d had a car repossessed, you missed three mortgage payments, and just like that your credit was basically trashed. In a stroke of luck, you were able to sell the house to avoid further missed payments, but you were stuck with the bad credit score. Now that some time has passed and you’re working steadily again, you’re ready to buy a new home.

The question is how to get a home loan with bad credit. Well, I have some good news and I have some bad news. The good news is that home loans with bad credit absolutely do exist. The bad news is that you, as a ‘credit-challenged’ borrower are going to have an entirely different application and qualification process than people with unblemished credit. You are likely to be able to buy a house again, but it’s going to take some patience and work.

As usual, you need to go through your own preparation process before ever going to talk to a mortgage broker or bank representative. Before you walk through their office door you need to already be clear on a) your credit grade (A through D), your FICO score, the LTV (loan to value ratio) of the home you’re trying to buy, and your real affordability range. As a person with credit that’s already somewhat damaged you really have no business pushing the envelope at all when it comes to your ability to stay way ahead of your payments.

Once you’re clear on the fact that you have everything in place that you possibly can in terms of your own self prequalification process, it’s time to go to the lender and see what your options are.

The biggest way you’re going to feel your bad credit score is in the fees and the interest rates you’ll be charged on your mortgage. Usually, the loan origination fees paid during the mortgage application process are called ‘points,’ and a prospective borrower can pay anywhere from one to five points as an origination fee. People with great credit very often pay zero points, while those that are trying to get a home loan with bad credit often pay up to four or five. That can get very expensive if you think about the fact that a single point on a $200,000 mortgage is $2,000.

I realize you’ll be very frustrated having to pay such steep fees thanks to your poor credit score, but there’s a certain courtesy you should extend to the loan originator working on your mortgage. It won’t do you any good to make ridiculous demands as far as lowering fees or interest rates. You have to keep in mind that anyone working on your loan will be paid completely on commission, and if you turn into a big headache they’re going to cut you loose and go work with a client that is a lot less hassle for the money. Get the best terms you can, but don’t alienate the people working to help you out.

If you’re persistent and you do your homework, you’ll able to land the home loan you want. After a few years of on-time payments you’re likely to see your credit score jump way up, and you’ll be able to investigate a refinance that will make your interest rate much more attractive.

Unsecured Loans for Bad Credit

I’ve been hanging around the world of finance and loans now for a while – everything from mortgages to car loans to credit cards. Then in the last ten years or so I see this explosion of personal loans with all their names and variations – unsecured loans for bad credit, payday loans, etc etc. Because of the jobs I’ve had I’m definitely not opposed to the different financing tools; I’m not some anti-debt zealot kook if you know what I mean (not to say that I think people should be in debt – I just recognize that the instruments of finance are fairly important to our economy).

But I just can’t seem to stomach these bad credit unsecured loans – or payday loans, or whatever they’re called. I can’t imagine a single circumstance where it’s a good idea for a person to borrow money this way, although I know what the owners of these corner payday loan stores would say:

1. Payday loans save people who are in truly tight spots, whether they’re facing unexpected car repairs, a medical emergency, a travel emergency (ie a family member out of state being injured, etc), home repairs and whatnot.

2. These guaranteed loans no credit check are not meant to be long term financing tools, and they’re not meant to be used by the same people over an over.

3. Unsecured bad credit loans simply fill a hole in the market, allowing consumers to borrow money much the same way banks borrow from each other when they run short of cash.

Each of these rationalizations should be demolished individually:

1. First of all, every one of those circumstances should be taken care of by having even a modest emergency fund on hand. If a person can operate their personal finances so close to the edge of being broke all the time – that’s still proof they manage their finances! In other words – if you can be just this side of broke all the time, you can change your habits slightly to keep an extra $500 in a savings account to take care of the emergencies mentioned above.

2. Everyone who has spent even ten minutes in the marketing world knows that your biggest source of business is almost always your repeat customers. Consumers are very habitual by nature. The single act of using one of these unsecured loans with bad credit guarantees that a certain percentage of people will use them again. You will not find a single payday loan provider who doesn’t make some effort to keep in touch with his customers so he can lend to them again in the future.

3. This is just ridiculous. Huge financial institutions do many things that individuals shouldn’t be doing. I’ll refer back to #1 and say that all you need to do in life to reduce your financial stress by an order of magnitude is scrape together and maintain a small emergency fund.

And the end of the day, it’s almost criminal that we allow people to borrow money at rates that would end up being 300% to 500% if we let people carry them out for longer terms. I’d strongly encourage all of you reading this to be a much more careful steward over your money – however little you have – so you can sleep better at night and enjoy more peace of mind.

No Credit Check Unsecured Loans

Anybody who ever applied for any kind of loan would love to have the bank skip the credit check. The whole situation can be very uncomfortable, right? You have to give them all this personal information about yourself, including your social security number (and who feels safe doing that?), and then they click a few buttons on the keyboard…so they can come back and say that because you missed one car payment in 1994 they’re not going to approve you for the loan you really need. I say no thanks. I’d much rather have no credit check unsecured loans.

The great thing about an unsecured loan with no credit check is that a) they’re not going to even bother looking at your credit as part of deciding whether you’re qualified, and b) the loan is unsecured, so you don’t have to provide any form of collateral whatsoever.

Alright, we just have to be real here. If you think you can get a loan with these characteristics you’re a little loopy, and that’s putting it kindly. What you’re essentially saying to the bank is “Give me a loan based on nothing but my good looks and handshake.” You’re asking them to lend you money when you’ve clearly left some other lender with zilch in the past – that’s how your credit got messed up in the first place.

You either don’t want to provide any collateral, or you don’t have any to offer them – so it really comes down to you asking the lender to trust your best intentions and completely ignore your past transgressions. Do you think that’s a fair proposition?

Now, I’m being a little hard on you – the truth is there are loans out there that at least resemble a no credit check unsecured loan, but a better name for them is a bad credit payday loan. And it is possible to get those. I’ll tell you now that you’re not likely to get more than a few hundred dollars through these loans, and you’ll pay handsomely in the form of up front fees and steep (like Everest) interest rates.

If those are things you can handle than these loans are probably what you’re looking for.

Cheap Unsecured Personal Loans

Most people are going to come up against a situation in their life where they run out of cash before they run out of bills, and when they do they’re going to be looking for some time of personal loan to get them through to their next paycheck. Below I’ll discuss a few types of unsecured and secured personal loans that might be a good fit for your situation.

Bad Credit Signature Loans

Yes – there is such a thing as a loan that doesn’t require collateral but is still available to people who’ve messed up their credit rating in one way or another. Here’s what you’re up against – banks, even payday loan providers, aren’t going to throw money at you just because you need some cash to buy groceries or get the muffler on your car fixed. They’re going to want to see proof that you can repay the loan; which could come in the form of showing them several pay stubs or maybe a reference from your landlord saying how faithful and punctual you are in paying your rent every month. These types of loans are definitely going to come with some fees and a not-so-great interest rate, but you do what you have to do to get by. After taking out and repaying a few of these you might be able to get your credit score to a point where traditional lenders will look at you.

Guaranteed Unsecured Personal Loans

When you’re talking about any type of guaranteed personal loan it usually means two things: first, the person seeking the loan probably messed up his or her credit at some point, which means the only loans available are bad credit loans. Second, guaranteed loans often refer to loans that an organization (such as the government or veterans administration) will back up so the lender can feel a little more at ease about getting their money. Again, with these types of quick personal loans you’re not going to be offered low interest rates or favorable terms in general. After all, your past bad behavior has proven that you’re a risky investment for any lender. Their ability to stay in business depends on how wisely they lend money. The up front fees and high interest they charge on your loan protect them from going through what you want to avoid most – bankruptcy. Recognize that they need to be paid for the risk they’re taking, but while you’re paying them back you’re improving your ability to borrow in the future in a way that’s better for you.

Signature Loans with No Credit Check

There are going to be times when your life circumstances don’t let you go through a long personal loan approval process. In those times fast unsecured personal loans are going to be your best bet. These are the kinds of loans you’d get at your local payday loan store – you walk in, fill out the paperwork, and often you have your personal loan disbursement within just a couple of hours. If you’re in need of emergency cash, these are the best loans for you, although they come at a price. If you don’t want to get one of these in-store or in a bank you can always opt to look into online signature loans; these are ones which you can apply for at the click of a mouse. You might pay anywhere from 5% to 15% of the loan amount in fees, not to mention the fact that you’re going to end up with an interest rate that sneaks up on 30% – which makes even the worst credit cards look appealing. Borrow these loans wisely – they’re for emergencies only.

Unsecured Personal Loans With Bad Credit

Your credit might get to a point where it would be pointless to check your credit anyway – so you might as well approach a lender who offers unsecured loans no credit check. They do exist, but this isn’t exactly the premium lending world. These lenders are willing to lend to give loans to people with very bad credit, but not without covering their risk. The way they manage their risk and maximize their reward is by a) charging you fairly large fees when you take the loan out, and b)making sure the interest rate is in their favor – not yours. If you can handle these conditions then this kind of loan could be a good fit.