I remember back in the good old days, when I had been through a few bankruptcies and things weren't so great for me, when I couldn't even borrow a cold. If you have bad credit, it's hard to borrow money or get a credit card. If you can get a loan at all, it will have higher rates and payments.
You don't have many choices. Lending institutions will think you are a high-risk customer and either refuse to give you a loan or charge you more for it to make up for the risk. Sometimes this problem can be solved by getting a co-signer. The credit score of the co-signer will also be taken into account. This could lower the interest rate and help you get the loan. But it isn't always enough for loans that don't have to be paid back.
My first credit card after I went bankrupt had to be backed by cash.
If you have bad credit, you can now easily apply for credit cards or loans that are made just for people with bad credit.
For example, you can still get a home equity loan even if you have bad credit. Also, if the borrower has bad credit, home equity loans are a great option for both the lender and the borrower. Home equity loans help the lender feel safe and help the borrower save money on interest rates.
People with bad credit can actually get home equity loans much more easily than other loans. But you need to be careful with how you pay it back. Since these loans are secured to protect the lender from default, if you don't make your payments, the lender could take back the thing you put up as collateral.
If you use the money wisely, like by paying off credit card debt, it could help your credit score on its own. But there is something hidden here. Once you've paid off your credit card debt, don't do it again.
Even if you have bad credit, it's not too hard to get a Home Equity Loan. Like with anything else, you should do your research to find the best deal, and you should be careful not to make your situation worse by wasting the money.
