More and more people suffer from bad credit history, not being able to get a loan in banks without any problems. However, bad credit history is an easy-to-solve problem. In this post, we will describe how to have your loan request approved even if your financial report is not perfect.
Favorable conditions for obtaining a small business loan bad credit in case of unfavorable records:
- Official employment: the more experience you have, the better; at least six months of working experience will be a benefit to you. The company’s reputation also plays an important role here: employees of large companies are trusted;
- Salary level: the maximum credit limit depends on it;
- Liquid assets: the presence of a car and real estate are another argument for approving your loan request;
- Deposit in a bank;
- Marital status: being married and having 1-2 children is a sign of liability. If there are 3 or more children in your family, you are unlikely to get a cash loan as the bank considers that children take a lot of expenses;
- Creditworthy guarantors.
What Alternatives are There?
Provided that your financial records are not flawless, there is a way out with the following solutions.
Some of the brokers know the confidential data about which credit bureau banks work, how they treat customer delinquencies, and so on. Thus, credit brokers can assist in acquiring a loan. But at the same time, there is a great risk that a down payment will be required for their services.
Though, be ready to overpay; the commission of a private investor will not be small – it can go up to 50% of the loan amount.
For a small-scale loan, you may issue a credit card with a set limit. This minimizes the risks for the bank, and regular replenishment of the card will help you cover the debt.
Take an Express Loan
It is similar to an ordinary loan. However, in this case, it is feasible to issue a loan without going to the bank office and showing your income level. What’s more, express loans are granted within a few minutes. You should not count on a large amount; it is better to limit yourself to a small loan. Also, such loans are issued at a higher percentage, so use them precisely as a “bridge” to obtain a regular bank loan.
Get a Secured Loan
This is your statement of your solvency in a completely real form. The collateral may be housing, property, commercial real estate, securities, nor a guarantee of a third party whose credit report is just flawless.
Take a Microloan
Microloans are the same as traditional loans; the only difference is associated with their “mini” format. They are issued not by banks but microfinance companies. Do not think that MFIs give finances to everyone, but the possibility to get a loan from such establishments is several times higher than in a regular bank.
Find a Private Lender & Complete a Transaction Through a Notary
Private lenders are today a popular option. Having issued a notarial transaction, you will need the help of not a bank but a specific person.