Debt Consolidation Credit Counseling In Phoenix

Occasionally, bad things happen to good people. They lose jobs, or a they experience a severe or catastrophic illness and income dries up. Many times, their credit ratings also begin to fall. After that, the chances of getting regular credit can be slim for a while, but they may still have a need for some form of credit. The question that should be asked in those cases is do you need a guaranteed bad credit loan?

High Interest Rate Loans. A guaranteed bad credit loan is nothing more than a loan given out by a loan funding source which has more expensive repayment terms due to the riskier nature of the loan. Because money for these kinds of loans comes from money markets that charge more to get the money, lenders must in turn charge borrowers more for loaning it to them. Remember, the worse your credit is, the more interest you'll generally pay. Both lenders and borrowers risk more in this process, which is a good explanation for why these loans have higher interest rates.

Applying for One. These loans cost more to get, so ensure you have to have one before committing yourself to any loan terms. And check with banks or other standard lending sources first. You may just qualify for a regular loan. In any event, credit is almost a necessity everywhere these days, so having or creating a good credit repayment history can pay off in the long run.

Does A Guaranteed Bad Credit Loan Help? If you need to work on repairing bad credit, and a loan payment history is what's required, a loan of this type can help. Just make sure it's repaid on time and fully. Remember, every time you make a payment when it's due, your credit score improves a little. When you don't, it goes back down. Always pay a loan back, and always pay it on time.

Be Careful. Watch out for funding sources who tack on excessive late charges or hidden service fees. Also, read over the loan contract in full before committing to its terms. Make sure you get all questions answered to your satisfaction.

Summary. A guaranteed bad credit loan serves a useful role in our credit-driven society. If you need one, take caution and examine all loan documents carefully before signing.