Borrowing money is essential for many of us. Whether you’re making a huge purchase like a new house, a new car, or even a piece of furniture for the home, borrowing and paying back with monthly instalments often makes more sense. But having a poor credit score can restrict your ability to borrow money when you need it the most. And, a poor credit score doesn’t always mean that you’ve failed to make repayments in the past; if you’ve never borrowed before and don’t have any credit history to show, you could suffer just as much. So, what can you do? Here are some tips for successfully borrowing money when your credit rating isn’t great.
If you are struggling to borrow money because you’ve never had to borrow or make repayments before, don’t worry. You can be in a better position than somebody who’s struggling because they have been in debt in the past, but you might struggle to get a large loan or credit card just yet. The best thing to do is start small. Use online eligibility checkers to determine what kind of credit you are likely to be accepted for before you apply, as being rejected after making an application can harm your credit further. You can apply for a short-term bad credit loan right here on SimplePersonalLoans and when you repay it on time, your credit rating will improve.
Consider Bad Credit Options
Depending on the state of your credit score, you might be eligible for bad credit options. It’s a good idea to get a copy of your credit rating first and determine whether or not you have a chance of being accepted when applying. Use an online eligibility checker to see which credit building credit cards you might have a chance with. Typically, if you are not currently in debt and some time has passed since the negatives appeared on your credit score, or you have made any further repayments on time for some time since you will be eligible for a credit-building card to help you out. You can usually expect a smaller-than-usual credit limit, but this can be increased as you demonstrate your ability to repay.
If all else fails, you may still be able to get credit with the help of somebody else. A guarantor is an individual who agrees to ‘guarantee’ your loan by declaring that they will make the payments if you are unable to. They often have to be a homeowner but this is not always required. They should have a good credit history and be in a financial position to comfortably make the repayments if you are unable to. However, it’s advisable to use this option only as a last resort since guarantor loans often come with extremely high interest rates compared to other options.
Having a poor credit score, whether it’s from a lack of credit or past borrowing, shouldn’t have to completely get in the way of you getting the funds you need right now.