Poor credit loans are loan products that are designed for consumers who have a negative credit history. Bad or poor credit is generally considered a score below 580, although each lender may have its own criteria for determining who qualifies for a poor credit loan.
There are a number of different poor credit loan products that consumers may qualify for, including personal loans secured by collateral, vehicle loans and even mortgages. These loans may have down payment requirements, especially with vehicle loans. Consumers should also expect to have a higher interest rate with a poor credit loan, and a lender may require that the consumer have a co-signer to receive approval. Applicants should also be prepared to submit documentation regarding income, and some lenders may also require the borrower provide a list of references.
Consumers do have a variety of options when seeking a poor credit loan. One option is to apply with a company that focuses on loans for poor credit. Another is to apply through a peer lending network that matches borrowers with individuals who are looking to loan funds as an investment. Payday loans are another option for consumers with bad credit, as these types of loans generally do not require a credit check.