Can You Get a Loan With Bad Credit?

Sometimes things happen in peoples' lives that are unavoidable. The result may be bad credit. So does having bad credit ruin you for life? The answer really depends on how bad the credit is and how quickly you act to repair it.

Credit card companies, banks, and automotive companies all check your credit report before giving you a credit card, loaning your money or providing a loan for a car. Your credit rating determines the outcome and also determines the interest rate on your loan. If your credit rating is very low and in the poor category, you will have a hard time acquiring a credit card or borrowing money. However, if you just have a few marks on your credit, you should be able to acquire a credit card or a loan, but with a higher interest rate.

If you have bad credit another way to obtain a loan for an automobile or for a mortgage is to make a large down payment and accept a high interest rate. The theory for lenders is that, the more investment you have in the home or auto, the more likely you will continue to pay the loan. If you do default, the lender is better able to make their money back.

Bad credit can affect your life for seven to ten years. Bad debt is removed from your credit report after 7 years and bankruptcy stays on for 10 years. Bad credit makes it hard to attain the things that you want in life and even your ability to obtain some jobs.

Without credit you are unable to secure a credit card, rent a car, book a hotel room, buy anything on the internet, buy a house, buy a car and purchase airline tickets. With bad credit you also end up paying more if you do manage to get a high interest credit card.

It is still a good idea to accept the card with the high interest or the mortgage with a large down payment and high interest, because if you make good on the loan it will raise your credit score and act as a credit repair in the long term.

The best defense is to keep your credit clean by making timely payments and not buying things on credit if you know you cannot afford the payments. If you do run into trouble through unforeseen circumstances, talk to a debt counselor as soon as you can and try to rectify the situation before it turns bad and damages your credit. You can learn strategies to repair your own credit or you can work with a credit repair and debt relief company.

There are some reputable credit repair companies and there are those that give advice that could land you in jail. So buyer beware. Do your homework and educate yourself before you make a decision to work with a company.

This is a guest post written by Ravi the admin of loansbuzz.com