Having poor credit is like having bad in-laws; every time you try to do something it’s there trying to make your life miserable. The good news, however, is that more and more lenders are starting to give loans to people with poor FICO scores. In fact the increase in lending to subprime consumers (i.e. people with bad credit scores) rose by 41% in the last year. Experts predict that this trend will continue to increase as banks ease up on their lending restrictions. Considering that millions of people also have less than stellar credit it’s really no surprise that the banks are starting to cozy up to them again.
No matter who you go to you’ll want to get your credit report in order before you do. If you have mistakes that are dragging your score down you should fix these problems first by getting a copy of your credit report and going over it with a fine toothed comb to make sure everything is correct and in order. The 3 main credit reporting agencies are required to give you 1 free report per year.
One of the first places that you’ll want to try and get a loan is of course your own bank. They know you and may be able to lower their restrictions for you, especially if you have a good relationship with them over a long period of time. Of course if you overdraw your account all the time and have a history of rubber checks you might not want to start there.
Your local Credit Union may be able to help if none of the banks will. They are non-profit organizations that are in place to help their members in the community (that would be you) and may just be able to give you a loan at a competitive rate even if your credit score isn’t a shining beacon of purity. Most towns have a credit union and you can find yours by visiting them online at the NCUA website.
Not that we highly recommend this but one final option is to ask a trusted relative with good credit to co-sign for your loan. This is risky for not only you but your relative as, if you stop paying or start paying late, their credit will suffer as well as yours. That would be a real bummer during the Holidays so make sure you can pay back what you’re borrowing with no problems before you decide on this option.