Online Bad Credit Loans

1. Bad credit loans must be secured by personal belongings.

False They can be secured or unsecured. Secured means that there must be collateral attached. Failure to pay could result in loss of a home or other personal belongings. Receiving unsecured bad credit loans means no collateral is attached and approval for borrowing is on the ability to repay through income and past payment history.

2. Bad credit loans can be approved even if bankruptcy has been declared.

True They can usually be approved even if an applicant has recently declared bankruptcy, foreclosure, repossession or divorce. Many companies accept clients with bad or no credit history. Specialist companies who deal with lower than average credit applicants can be found easily on the Internet.

3. Bad credit loan clients who pay on time improve their credit score.

True Those who pay on time and in full will improve their credit score dramatically. They will later be able to apply for more loan programs with better interest rates. It can be an alternative way to begin building good credit for life.

4. Bad credit loans will have higher interest rates than standard loans.

True Since credit is not yet established the financial lending institutions are able to charge a higher interest rate. Most people would be approved for a standard loan, so the higher interest rate is charged for those that pose a higher risk to the lender. Interest rates can still be negotiated, and it is wise to obtain a copy of an individual credit report to know exactly where you stand from all the national credit bureaus.

5. Bad credit loans are a way for companies to extend grace.

True
Deuteronomy 15:7 - If there be among you a poor man of one of thy brethren within any of thy gates in thy land which the LORD thy God giveth thee, thou shalt not harden thine heart, nor shut thine hand from thy poor brother: