Guaranteed Approval Payday Loans

Your credit is so bad that you don’t even want to think about it. You know that your chances of getting a loan from a bank is so small that you don’t even want to try. What are your options?

When you go online, you might see the ads of payday lenders. They say that they are offering guaranteed approval payday loans for people with bad credit. They might have been talking about you! You have bad credit and you need a loan.

Before you go ahead and jump in on getting a loan from them you should realize a few things first.

Guaranteed Approval Payday Loans

A guaranteed approval bad credit payday loan sounds too good to be true. Unfortunately, it is. Payday lenders are still out there for profit and the only way that they can make money is if the people that they lend to pay them back. That’s why they have to be sure that they would only be lending money to consumers who have a good chance of paying them. Like banks and other financial institutions, payday lenders also assess the creditworthiness of consumers, though they follow a different process.

If you see a payday site advertising that they are giving out guaranteed approval payday loans, you have to read more deeply. There is no such thing as a guaranteed approval payday loan. When you go through the site, they would tell you that you would still have to qualify for the loan.

Teletrack and Payday Lenders

Cash advance lenders do not follow the same route of banks and other financial institutions when checking credit. They do not turn to the big credit reporting firms. They use the services of other credit reporting bureaus such as Teletrack which keeps track subprime loans, which is more relevant to them. While payday lenders might not care if you have a bad credit, they would want to know if you have skipped a payday loan or some other sub-prime loan in the past. Even the “no Teletrack loans” can be deceiving, because you can bet that the lenders are still using some method or other in order to check your credit history.

When compared with other loan types, it is far easier to get payday loans but it is far from guaranteed. That’s should serve as food for thought when you are planning on getting a payday loan. There is a real chance that your loan application is not going to be approved.

Getting a Loan with Bad Credit

Why are you considering a payday loan in the first place?

For many payday loan users, it’s because they have bad credit. But having a bad credit score does not mean that the doors of all financial products would be closed to you. There are still ways that you can get loans and financial backing even though you have bad credit. You don’t have to consider getting a payday loan right away just because your credit is not so good.

First of all, your credit standing is not the only thing that lenders consider when you apply for a loan with them. Though, it is a major factor, you can still get a loan even if your credit is bad when you do well on the other factors that they check. Another factor that plays a huge role in determining the creditworthiness of a borrower is their debt to income ratio. This is the amount of money that a person is earning as compared with the amount of debt that the person has to pay. This is just as important to consider as the income of a person. Someone with a high income but with a huge amount of debt is high risk borrower in the long run.

Here are some of the ways that you can get loans even though you have bad credit :

Home Equity Line of Credit

The recent financial crisis which had its roots from the housing bubble has left many Americans owing more than what their homes are actually worth in the market. But if that is not your situation then you can use the equity on your property and get a line of credit based on that. You are basically using your property as a security for the line of credit that you are getting. There is always some risk involved in that. If you are unable to pay for the loan, then your ownership of the property can be placed in jeopardy. There is a very real chance that you could lose ownership of it. But this is one of the best ways that you can get a loan though you might have bad credit.

. Credit Unions

Credit unions have a lot in common with banks and they usually offer the same kind of services and financial products. But credit unions are not run for profit, or at least that is not their primary aim. Credit unions are owned by its members and all the members share something in common. They could be working in the same industry or they could be living in the same place. They also offer loans and similar financial products.

The advantage of getting a loan from a credit union is that they do not charge the same kind of interest from payday lenders. Their interests are a lot more reasonable. You should compare the offers from several credit unions to be sure that you are getting the best deal there is. But qualifying for a credit union loan is not as easy as qualifying for a cash advance loan.

Peer to Peer Loans

In peer to peer lending, you will be able to borrow the money that you need from people who are just like you. Instead of needing cash however, they have the extra money that they want to invest into something. The peer to peer lending service allows you to meet with those people and come up with an arrangement on how you can borrow money from them and pay them back.

The rates that you can get from peer to peer lending are very competitive. The problem is that while it does not require a high credit score, that can still have its benefits as well, the better your credit standing, the better the deals that you can get. It can also be a fast way of getting cash since the processing time for peer to peer lending is quite relatively quick.

Credit Card Cash Advance

A credit card cash advance is also noted for being rather expensive, but while it is costly, it is still a lot cheaper when compared with payday loans. You should be careful to only use it when you really have to so that it does not become a habit. Make sure that you pay back the full amount plus the interest so it does not accumulate. The great thing about a credit cash advance is that you can do it anytime. That makes it ideal for real cash emergencies.

Borrow from People You Know

A lot of people are really embarrassed when they think about borrowing from people that they know. They feel that nothing could be more humiliating. But before you close that option, think and consider, is it really such a bad idea? Getting cash from your friends and relatives might not be such a bad idea after all when you think about it. Remember the cost of payday loans? Are you more willing to face that cost than to try and get a loan from a trusted friend or a relative that you can count on?

When you get a loan from someone you know, you don’t really have to worry about paying it back immediately. Of course you have to pay the loan, but it is less urgent than if you borrowed from a bank. There is also nothing to worry about interest which is the main thing that you need to worry when you get a loan from financial institutions.

Get a Co-Signer

You know what can clear up that bad credit of yours? The best way to clear it up would be to see if you can convince someone to act as a co-signer. A co-signer is someone who would be willing to guarantee the loan on your behalf. If you default on the loan, the lender could go after the co-signer. He/she would be equally responsible for the loan. Lenders would be willing to overlook the fact that you have bad credit if you can find someone who would be willing to take responsibility with you.

The chances of someone agreeing to become a co-signer are remote. It simply is too risky. They would be putting themselves at risk without any benefit for themselves. So if you find someone willing to be a co-signer to the loan then you are very lucky.

These are just some of the ways that you can get a loan though you have a bad credit.