Credit Score of an individual is the reflection of his credibility and it helps the bank or loan provider to access the capacity of the user to repay the loans. While most of the companies do not offer any type of loan to individuals with bad credit score, there are some money lenders that have flexible requirements. Your credit score is always the deciding factor that every bank or money lending company looks for while offering a loan. While you cannot boost your credit score overnight, you can try some options that can overlook your credit score and offer small loans at low-interest rates.
It is important to note that loans and bad credit does not go well together and thus if you have a bad credit, it can be very hard for you get even small loans. The best place to look for loans in case of a poor credit score is a local credit union. It is impossible to get a loan from banks unless you have a good credit score. The next option that you can consider is of online money lenders. However, there can be a significant difference in the interest rates charged credit unions and online money lenders. The interest rates charged on loans is measured or expressed in terms of annual percentage rate abbreviated as APR. Annual percentage rate is defined as the annual rate of interest that is charged on the amount that you borrow or invest. If you obtain at loans at 15% APR, it simply means that for every $100 that you have borrowed, you will be required to pay $15 extra at the end of every year.
The loan offered by banks has the lowest APR around 10-12 % but there are tough requirements to qualify for the bank loan. A federal credit union is the next on the list in terms of low APR ranging from 15 to 18 %. A federal credit union does not charge annual percentage rate more than 18%. Online lenders come next on the list with annual percentage rates that can be as high as 36%. If that does not work out, there are small loans bad credit offered by lenders that do not consider credit scores at all but charge very high annual percentage rates. However, you must be very careful while taking loans from such lenders as they can trap you badly in debt cycle that you end up paying APR as high as 1000%.